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First Data (FDC) Partners With Ellie Mae, Boosts ISV Suite

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First Data Corporation yesterday announced an integration with Ellie Mae, Inc.’s Encompass Consumer Connect lending platform.

Ellie Mae is a California-based provider of on-demand software solutions and services for the residential mortgage industry. Part of Ellie Mae’s Digital Mortgage Solution, Encompass Consumer Connect was launched on Mar 7, 2017. It enables borrowers to apply for mortgages online, interact with loan officers and securely eSign and upload documents.

Under the partnership, the duo will assimilate secure payments technology to process mortgage and appraisal fees, thereby enabling Ellie Mae customers accept payments associated with the lending process (including loan origination, processing, underwriting and credit reports). Ellie Mae will leverage First Data’s BluePay Gateway, part of the company’s CardConnect ISV platform.

Active on the Partnership Front

First Data’s ISV business is expanding on the back of its robust portfolio of relationships. This month, the company partnered with Community Brands to deliver integrated payment processing technology solution for cause-based organizations. The partnership involves the integration of First Data’s BluePay Gateway with Community Brands association management software (AMS) solutions.

Previously, in second-quarter 2018, First Data partnered with Revention to allow integration of its Bolt technology and mobile SDK offering with Revention’s POS platform. In another partnership with Desert Micro, the company is integrating its gateway and our mobile SDK offering with Desert Micro’s solution. With 94 new ISVs in the second quarter, the ISV business recorded more than 50% revenue growth.

So far this year, shares of First Data have gained 50.1%, significantly outperforming the 9.8% rise of the industry it belongs to.

 

Boosts GBS Segment

ISVs are one of the several indirect non-bank sales forces First Data’s Global Business Solutions (GBS) segment partners with to sell the company’s commerce solutions to small and medium-sized businesses. Along with strengthening First Data’s portfolio of ISV partnerships, the latest collaboration with Ellie Mae’s Encompass Consumer Connect lending platform is likely to drive the Global Business Solutions segment.

In the first half of 2018, the segment contributed the largest chunk (around 64%) to the company’s total revenues and grew 18% year over year on a reported basis to $2.77 billion. The segment improved 14% on a comparable accounting basis and 7% on an organic constant currency basis.

Zacks Rank & Stocks to Consider

Currently, First Data carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Some better-ranked stocks in the broader Business Services sector include Genpact Limited (G - Free Report) , WEX Inc. (WEX - Free Report) and Broadridge Financial Solutions, Inc. (BR - Free Report) . All the stocks carry a Zacks Rank #2 (Buy).

The long-term expected EPS (three to five years) growth rate for Genpact, WEX and Broadridge is 10%, 15% and 10%, respectively.

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