Fiserv, Inc. (NASDAQ:FISV) is gaining from a diverse product portfolio that continues to yield a steady flow of customers.
Shares of the company have improved 11.5% in the past year outperforming the 10.3% rise of the industry it belongs to.
With expected long-term earnings per share growth rate of 11.5% and a market cap of $29.1 billion, it is a stock that investors should retain in their portfolios for now.
Factors Driving Fiserv’s Performance
A strong position in the financial and payments solutions on the back of a diverse product portfolio, broad customer base, high recurring revenues and consistent technology upgrades are boosting Fiserv’s momentum.
The recent acquisition of debit processing solutions of Elan Financial Services is expected to boost the company’s payments portfolio, expand client base and provide new solutions to enhance the value proposition for the existing 3,000 debit solutions clients.
Fiserv, Inc. Revenue (TTM)
Wrapping Up
Despite riding on significant growth prospects, Fiserv is not free from overhangs. The company has a debt-heavy balance sheet, with debt at the end of the third quarter accounting for 64% of total capital. A high debt may limit the company’s future expansion and worsen its risk profile. Also, Fiserv’s policy of acquiring a large number of companies results in integration risk. Nevertheless, we believe that strong market position and increasing customer base bode well for Fiserv.
Stocks to Consider
Fiserv carries a Zacks Rank #3 (Hold).
A few better-ranked stocks in the Zacks Business Services sector are Insperity (NYSE:NSP) , SPS Commerce (NASDAQ:SPSC) and Information Services Group (NASDAQ:III) , each sporting a Zacks Rank #1 (Strong Buy).You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
The long-term expected EPS (three to five years) growth rate for Insperity, SPS Commerce and Information Services Group is 18%, 20%, and 14%, respectively.
Today's Stocks from Zacks' Hottest Strategies
It's hard to believe, even for us at Zacks. But while the market gained +21.9% in 2017, our top stock-picking screens have returned +115.0%, +109.3%, +104.9%, +98.6%, and +67.1%.
And this outperformance has not just been a recent phenomenon. Over the years it has been remarkably consistent. From 2000 - 2017, the composite yearly average gain for these strategies has beaten the market more than 19X over. Maybe even more remarkable is the fact that we're willing to share their latest stocks with you without cost or obligation.
SPS Commerce, Inc. (SPSC): Free Stock Analysis Report
Information Services Group, Inc. (III): Free Stock Analysis Report
Insperity, Inc. (NSP): Free Stock Analysis Report
Fiserv, Inc. (FISV): Free Stock Analysis Report
Original post
Zacks Investment Research