It has been about a month since the last earnings report for Fiserv . Shares have lost about 5.2% in that time frame, outperforming the S&P 500.
Will the recent negative trend continue leading up to its next earnings release, or is Fiserv due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important catalysts.
Fiserv Beats Q1 Earnings & Revenue Estimates
Fiserv reported impressive first-quarter 2022 results, wherein the company’s earnings and revenues surpassed the Zacks Consensus Estimate.
Adjusted earnings per share of $1.4 beat the consensus mark by 3.7% and increased 19.7% year over year. Adjusted revenues of $3.9 billion beat the consensus estimate by 1.8% and increased 9.8% year over year.
Organic revenue growth was 11% in the quarter, driven by 20% growth in the Acceptance segment, 6% growth in the Fintech segment and 5% growth in the Payments segment.
Other Quarterly Details
Processing and services revenues of $3.4 billion increased 10.2% year over year. Product revenues of $774 million were up 10.4% year over year.
Revenues at the Merchant Acceptance segment came in at $1.7 billion, up 18.3% year over year. Revenues at the Financial Technology segment increased 5.7% year over year to $778 million. Revenues at the Payments and Network segment increased 4% year over year to $1.5 billion. Adjusted revenues in the segment increased 4% year over year.
Adjusted operating income of $1.2 billion was up 11.8% from the year-ago quarter. Adjusted operating margin of 32% increased 60 basis points year over.
Balance Sheet and Cash Flow
Fiserv exited the quarter with cash and cash equivalents of $863 million compared with $835 million at the end of the prior quarter. Long-term debt was $20.5 billion compared with $20.7 billion at the end of the prior quarter.
The company generated $815 million of net cash from operating activities while free cash flow was $603 million. Capital expenditures were $331 million. The company repurchased 5.1 million shares for $500 million in the quarter.
2022 Guidance
Adjusted earnings per share are anticipated in the range of $6.4 to $6.55. The company expects organic revenue growth of 7-9%.
How Have Estimates Been Moving Since Then?
It turns out, fresh estimates have trended downward during the past month.
VGM Scores
Currently, Fiserv has an average Growth Score of C, though it is lagging a bit on the Momentum Score front with a D. However, the stock was allocated a grade of B on the value side, putting it in the top 40% for this investment strategy.
Overall, the stock has an aggregate VGM Score of C. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been broadly trending downward for the stock, and the magnitude of these revisions indicates a downward shift. Notably, Fiserv has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.
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Fiserv (FISV) Down 5.2% Since Last Earnings Report: Can It Rebound?
It has been about a month since the last earnings report for Fiserv . Shares have lost about 5.2% in that time frame, outperforming the S&P 500.
Will the recent negative trend continue leading up to its next earnings release, or is Fiserv due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important catalysts.
Fiserv Beats Q1 Earnings & Revenue Estimates
Fiserv reported impressive first-quarter 2022 results, wherein the company’s earnings and revenues surpassed the Zacks Consensus Estimate.
Adjusted earnings per share of $1.4 beat the consensus mark by 3.7% and increased 19.7% year over year. Adjusted revenues of $3.9 billion beat the consensus estimate by 1.8% and increased 9.8% year over year.
Organic revenue growth was 11% in the quarter, driven by 20% growth in the Acceptance segment, 6% growth in the Fintech segment and 5% growth in the Payments segment.
Other Quarterly Details
Processing and services revenues of $3.4 billion increased 10.2% year over year. Product revenues of $774 million were up 10.4% year over year.
Revenues at the Merchant Acceptance segment came in at $1.7 billion, up 18.3% year over year. Revenues at the Financial Technology segment increased 5.7% year over year to $778 million. Revenues at the Payments and Network segment increased 4% year over year to $1.5 billion. Adjusted revenues in the segment increased 4% year over year.
Adjusted operating income of $1.2 billion was up 11.8% from the year-ago quarter. Adjusted operating margin of 32% increased 60 basis points year over.
Balance Sheet and Cash Flow
Fiserv exited the quarter with cash and cash equivalents of $863 million compared with $835 million at the end of the prior quarter. Long-term debt was $20.5 billion compared with $20.7 billion at the end of the prior quarter.
The company generated $815 million of net cash from operating activities while free cash flow was $603 million. Capital expenditures were $331 million. The company repurchased 5.1 million shares for $500 million in the quarter.
2022 Guidance
Adjusted earnings per share are anticipated in the range of $6.4 to $6.55. The company expects organic revenue growth of 7-9%.
How Have Estimates Been Moving Since Then?
It turns out, fresh estimates have trended downward during the past month.
VGM Scores
Currently, Fiserv has an average Growth Score of C, though it is lagging a bit on the Momentum Score front with a D. However, the stock was allocated a grade of B on the value side, putting it in the top 40% for this investment strategy.
Overall, the stock has an aggregate VGM Score of C. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been broadly trending downward for the stock, and the magnitude of these revisions indicates a downward shift. Notably, Fiserv has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.