Fiserv, Inc. reported solid second-quarter 2021 results, wherein the company’s earnings and revenues surpassed the Zacks Consensus Estimate.
Adjusted earnings per share of $1.37 beat the consensus mark by 6.2% and increased 47.3% year over year. Adjusted revenues of $3.86 billion beat the consensus estimate by 3.8% and increased year over year.
Internal revenue growth was 18% in the reported quarter, led by 41% growth in the Acceptance segment, 5% growth in the Fintech segment and 7% growth in the Payments segment.
Let’s check out the numbers in detail.
Revenues in Detail
Revenues at the Merchant Acceptance segment came in at $1.67 billion, up 36.2% year over year. Adjusted revenues of $1.67 billion grew 42.8% year over year.
Revenues at the Payments and Network segment increased 7.7% year over year to $1.42 billion. Adjusted revenues of $1.43 billion grew 7.4% year over year.
Revenues at the Financial Technology segment increased 5.6% year over year to $754 million.
Revenues at Total processing and services segment increased 16.3% year over year to $3.36 billion while product revenues grew 20% year over year to $690 million.
Operating Results
Adjusted operating income of $1.31 billion was up 41.2% from the year-ago quarter. Adjusted operating margin of 33.9% grew 510 basis points (bps) year over year.
Adjusted operating income at the Merchant Acceptance segment was $524 million, up more than 100% year over year. Adjusted operating margin grew to 31.4% from 19.1% in the year-ago quarter.
Adjusted operating loss at the Payments and Network segment was $124 million compared with a loss of $106 million in the year-ago quarter.
Operating income at the Financial Technology segment totaled $273 million, up 8.3% year over year. Operating margin of 36.2% improved 80 bps.
Balance Sheet and Cash Flow
Fiserv exited second-quarter 2021 with cash and cash equivalents of $841 million compared with $831 million at the end of the prior quarter. Long-term debt was $20.4 billion compared with $20.8 billion at the end of the prior quarter.
The company generated $1.06 million of net cash from operating activities in the reported quarter. Free cash flow was $897 million. Capital expenditures were $260 million.
The company repurchased 5 million shares for $588 million in the reported quarter.
2021 Guidance
Fiserv has raised the lower end of its outlook for 2021. The company now expects internal revenue growth of 10% to 12% compared with the prior guidance of 9% to 12%.
Adjusted earnings per share are now anticipated in the range of $5.50 to $5.60 compared with the prior guidance of $5.35 and $5.50. The Zacks Consensus Estimate of $5.44 lies below the updated guidance.
Currently, Fiserv carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Performance of Other Business Services Companies
Equifax’s (EFX - Free Report) second-quarter 2021 adjusted earnings of $1.98 per share beat the Zacks Consensus Estimate by 15.8% and improved on a year-over-year basis. Revenues of $1.23 billion outpaced the consensus estimate by 6.4% and improved 26% year over year on a reported basis and 23% on a local-currency basis.
Robert Half’s (RHI - Free Report) second-quarter 2021 earnings of $1.33 per share beat the consensus mark by 26.7% and were up more than 100% year over year. Revenues of $1.6 billion surpassed the consensus mark by 6.5% and increased 42.3% year over year on a reported basis and 40% on an adjusted basis.
ManpowerGroup’s (MAN - Free Report) second-quarter 2021 adjusted earnings of $2.02 per share beat the consensus mark by 68.2% and improved more than 100%. Revenues of $5.28 billion beat the consensus mark by 2% and inched up 41% year over year on a reported basis and 31.3% on a constant-currency (cc) basis.
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Fiserv, Inc. reported solid second-quarter 2021 results, wherein the company’s earnings and revenues surpassed the Zacks Consensus Estimate.
Adjusted earnings per share of $1.37 beat the consensus mark by 6.2% and increased 47.3% year over year. Adjusted revenues of $3.86 billion beat the consensus estimate by 3.8% and increased year over year.
Internal revenue growth was 18% in the reported quarter, led by 41% growth in the Acceptance segment, 5% growth in the Fintech segment and 7% growth in the Payments segment.
Let’s check out the numbers in detail.
Revenues in Detail
Revenues at the Merchant Acceptance segment came in at $1.67 billion, up 36.2% year over year. Adjusted revenues of $1.67 billion grew 42.8% year over year.
Revenues at the Payments and Network segment increased 7.7% year over year to $1.42 billion. Adjusted revenues of $1.43 billion grew 7.4% year over year.
Revenues at the Financial Technology segment increased 5.6% year over year to $754 million.
Revenues at Total processing and services segment increased 16.3% year over year to $3.36 billion while product revenues grew 20% year over year to $690 million.
Operating Results
Adjusted operating income of $1.31 billion was up 41.2% from the year-ago quarter. Adjusted operating margin of 33.9% grew 510 basis points (bps) year over year.
Adjusted operating income at the Merchant Acceptance segment was $524 million, up more than 100% year over year. Adjusted operating margin grew to 31.4% from 19.1% in the year-ago quarter.
Adjusted operating loss at the Payments and Network segment was $124 million compared with a loss of $106 million in the year-ago quarter.
Operating income at the Financial Technology segment totaled $273 million, up 8.3% year over year. Operating margin of 36.2% improved 80 bps.
Balance Sheet and Cash Flow
Fiserv exited second-quarter 2021 with cash and cash equivalents of $841 million compared with $831 million at the end of the prior quarter. Long-term debt was $20.4 billion compared with $20.8 billion at the end of the prior quarter.
The company generated $1.06 million of net cash from operating activities in the reported quarter. Free cash flow was $897 million. Capital expenditures were $260 million.
The company repurchased 5 million shares for $588 million in the reported quarter.
2021 Guidance
Fiserv has raised the lower end of its outlook for 2021. The company now expects internal revenue growth of 10% to 12% compared with the prior guidance of 9% to 12%.
Adjusted earnings per share are now anticipated in the range of $5.50 to $5.60 compared with the prior guidance of $5.35 and $5.50. The Zacks Consensus Estimate of $5.44 lies below the updated guidance.
Currently, Fiserv carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Performance of Other Business Services Companies
Equifax’s (EFX - Free Report) second-quarter 2021 adjusted earnings of $1.98 per share beat the Zacks Consensus Estimate by 15.8% and improved on a year-over-year basis. Revenues of $1.23 billion outpaced the consensus estimate by 6.4% and improved 26% year over year on a reported basis and 23% on a local-currency basis.
Robert Half’s (RHI - Free Report) second-quarter 2021 earnings of $1.33 per share beat the consensus mark by 26.7% and were up more than 100% year over year. Revenues of $1.6 billion surpassed the consensus mark by 6.5% and increased 42.3% year over year on a reported basis and 40% on an adjusted basis.
ManpowerGroup’s (MAN - Free Report) second-quarter 2021 adjusted earnings of $2.02 per share beat the consensus mark by 68.2% and improved more than 100%. Revenues of $5.28 billion beat the consensus mark by 2% and inched up 41% year over year on a reported basis and 31.3% on a constant-currency (cc) basis.
Highest Returns for Any Asset Class
It’s not even close. Despite ups and downs, Bitcoin has been more profitable for investors than any other decentralized, borderless form of money.
No guarantees for the future, but in the past three presidential election years, Bitcoin’s returns were as follows: 2012 +272.4%, 2016 +161.1%, and 2020 +302.8%. Zacks predicts another significant surge in months to come.
Hurry, Download Special Report – It’s FREE >>
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