Fiserv, Inc. FISV reached a new 52-week high of $106.65 in yesterday’s trading session. Its shares have been rising since May 5 when the company announced its first quarter 2016 results. In addition, the company made a couple of collaboration-related announcements, which increased investor’s optimism.
Fiserv has extended its 16-year old credit processing contract with John Deere Financial, a division of Deere & Company DE by another 10 years. This apart, the company revealed that its Mobiliti Edge based solutions have been selected by the Bangkok Bank to enable mobile banking services for its clients.
Fiserv holds a dominant position in the financial and payments solutions business. In the recently announced first quarter results the company managed to deliver strong bottom line numbers despite soft top line growth. Moreover, the company has a strong pipeline and expanding margins, which allowed it to reaffirm its earnings and revenue guidance for 2016.
Fiserv has also made a couple of strategic acquisitions in the first quarter, ACI Worldwide’s Community and Billers Solutions, which would allow it to expand its product portfolio further over the long run.
In the past 30 days, upward estimate revisions have pushed up the Zacks Consensus Estimate for 2016 by 0.7% to $4.42 per share, while for 2017 it inched up 0.4% to $4.97. Moreover, in the same period, the company’s shares jumped over 8% compared with a gain of approximately 2% in the S&P 500 index.
Nonetheless, the company’s highly leveraged balance sheet and stiff competition from peers like Equifax Inc. EFX, Fidelity National Information Services, Inc. FIS and Global Payments Inc remain concerns.
Currently, Fiserv has a Zacks Rank #3 (Hold).
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