Tigress Financial Partners on Tuesday raised its price target on Fiserv (NYSE: ) (NYSE:FISV ), a leading provider of financial services technology solutions, to $190.00 from the previous figure while reaffirming a Buy rating on the stock. The company highlighted Fiserv’s continued growth driven by product innovation, international market expansion and market share gains.
Fiserv reported second-quarter 2024 revenue rising 7% annually to a record $5.11 billion. Much of this growth is attributed to the company’s comprehensive financial services solutions and strong client relationships. Processing and services revenue increased 5.5% year-on-year to $4.14 billion, while product revenue grew 16.2% to $967 million. It is worth noting that business solutions revenue grew by 9% and organic growth by 28%, totaling $2.41 billion; financial solutions revenue grew by 6% and organic growth by 8% to $2.37 billion.
The company’s success is driven by strategic initiatives, including launching new products and services, expanding into new markets, and building partnerships with key customers. Fiserv has secured multiple new customers in a variety of sectors, including gasoline, gaming, government and healthcare. Investments in technology, specifically in data science and artificial intelligence, enable Fiserv to leverage transaction and account processing data to derive actionable intelligence.
Fiserv’s commitment to innovation is reflected in its plans to introduce additional restaurant features to its Clover platform later this year, designed to enhance casual dining through improved table management, kitchen operations, inventory and cost management. The company also launched new banking features, such as an installment loan feature compatible with Apple (NASDAQ: ), and launched the Clover Compact and Clover Flex (NASDAQ: ) Pocket for small merchants.
The company’s growth trajectory is further supported by strategic acquisitions that expand its product and service offerings. Fiserv focuses on new growth opportunities and operating efficiencies to achieve accelerated business performance, enhanced returns on capital, economic profit growth and enhanced shareholder value. Last quarter, Fiserv repurchased 10 million shares for $1.5 billion and has returned more than $5 billion to shareholders through repurchases over the past year, totaling since its 2019 merger with First Data Corp. $15 billion.
Tigress Financial Partners remains optimistic about Fiserv’s further growth potential, saying its new 12-month price target of $190 implies potential upside of more than 20% from current levels.
In other recent news, financial services technology company Fiserv was the subject of positive reviews from several analysts following strong second-quarter results and an optimistic outlook. Mizuho Securities raised its price target on Fiserv to $183, citing strong performance in its business solutions business and the company’s ability to maintain its growth prospects despite broader economic concerns. Likewise, TD Cowen raised its price target to $182, citing the company’s consistent performance and successful execution of its product strategy.
B.Riley also raised the target price to $185, highlighting Fiserv’s consistent execution in driving sales growth and margin expansion. On the other hand, Argus raised its price target to $187 from $173 due to strong earnings and an enhanced financial outlook for 2024. Innovation is the key factor.
In terms of financial performance, Fiserv’s second-quarter profit increased by 31%, leading to an upward revision of its full-year profit forecast. The company’s processing and services revenue grew to $4.14 billion in the second quarter, and total quarterly revenue increased 7.4% to $5.12 billion, exceeding expectations. These are recent developments that have led to a series of price target changes from multiple analyst firms.
Investment Professional Insights
As Fiserv (NYSE: FISV ) continues to post strong financial results, InvestingPro data and tips provide more context for investors considering the company’s stock. Fiserv has a market capitalization of $90.88 billion and a price-to-earnings ratio of 27.32, which closely correlates with its trailing twelve-month adjusted price-to-earnings ratio of 27.52 through the second quarter of 2024. The company’s PEG ratio of 0.57 suggests that its shares may be undervalued relative to its earnings growth. Additionally, Fiserv’s trailing 12-month revenue growth of 7.2%, coupled with gross margins of nearly 61%, underscores the company’s ability to maintain profitability and operating efficiency.
InvestingPro Tips highlights that Fiserv is not only a well-known name in the financial services industry, but management has been actively buying back shares, which shows confidence in the company’s future. Additionally, analysts raised their profit forecasts for the period ahead, reflecting optimism about Fiserv’s potential to maintain its growth trajectory. Through the company’s strategic initiatives, such as the introduction of new capabilities on the Clover platform and its focus on technology investments, Fiserv is well positioned to take advantage of market opportunities. It’s worth noting that Fiserv doesn’t pay a dividend, which may discourage investors looking for income-generating investments. For those interested in a more in-depth analysis, additional InvestingPro tips can be found at https://www.investing.com/pro/FISV that provide more granular insights into Fiserv’s market position and performance.
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