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Fiserv's (FI) Q4 Earnings Surpass Estimates, Revenues Miss
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Fiserv, Inc.(FI - Free Report) reported mixed fourth-quarter 2023 results, wherein earnings beat the Zacks Consensus Estimate while revenues missed the mark.
Adjusted earnings per share (excluding 40 cents from non-recurring items) of $2.19 exceeded the consensus mark by 1.9% and increased 14.7% year over year. Adjusted revenues of $4.64 billion missed the consensus estimate by 1.1% but increased slightly on a year-over-year basis.
Organic revenue growth was 12% in the quarter, driven by 24% and 4% growth in the Acceptance and Payments segments, respectively.
Other Quarterly Details
Processing and services’ revenues of $4.03 billion increased 8.3% year over year and beat our estimate by 1.3%. Revenues in the Product segment were $892 million, down 1.9% from the year-ago figure and missed our estimate by 1.5%.
Revenues from Merchant Acceptance were $2.11 billion, up 13.4% from the year-ago figure, beating our estimate by 7.1%. The Fintech segment reported revenues of $800 million, indicating a 2.8% decline from the year-ago figure and missed our estimated $827.2 million. The Payments segment reported revenues of $1.72 billion, reflecting growth of 3%. The figure compares with our estimated $1.81 billion.
The operating margin from the Merchant acceptance segment was 38.8%, up from the year-ago figure of 34.8%. Adjusted operating margin from the Payments segment was 51% compared with the year-ago figure of 48.5%. Operating margin from the Fintech segment was 37.9%, down from the year-ago 41.3%.
Balance Sheet and Cash Flow
Fiserv exited the fourth quarter of 2023 with cash and cash equivalents of $1.20 billion. Long-term debt was $22.36 billion. FISV generated $1.6 billion in net cash from operating activities while free cash flow was $1.3 billion. Capital expenditures were $354 million. The company repurchased 8.6 million shares for $1 billion in the quarter.
2024 Guidance
Adjusted earnings per share are anticipated to be in the range of $8.55-$8.7 while the Zacks Consensus Estimate of earnings is pegged at $8.58 per share, lower than the midpoint ($8.63) of the guided range. The company anticipates the earnings per share (EPS) growth to be in the band of 14-16%. FI expects total revenues to grow 6.5-8.5% while organic revenues are expected to grow 15-17% year over year.
Adjusted EPS (excluding 40 cents from non-recurring items) of $3.04 beat the Zacks Consensus Estimate by 9.4% but decreased 18% from the year-ago reported figure. Revenues of $1.6 billion beat the consensus estimate by 0.6% and improved 5% year over year on a reported basis and 4% on a foreign-currency-neutral basis.
Total contract value was $4.8 billion, up 8% year over year on a foreign-currency-neutral basis.
Automatic Data Processing, Inc. (ADP - Free Report) reported impressive second-quarter fiscal 2024 results, wherein earnings and revenues beat the respective Zacks Consensus Estimate.
Adjusted EPS of $2.13 beat the consensus estimate by 1.4% and grew 8.7% from the year-ago fiscal quarter’s figure.
Total revenues of $4.67 billion surpassed the consensus estimate by 0.2% and improved 6.3% from the year-ago fiscal quarter’s reading on a reported basis as well on an organic constant-currency basis.
Booz Allen Hamilton Holding Corp. (BAH - Free Report) reported better-than-expected fourth-quarter fiscal 2024 results.
Quarterly adjusted EPS of $1.41 surpassed the Zacks Consensus Estimate by 24.8% and exceeded the year-ago quarter by 31.8%. The company reported revenues of $2.57 billion, which beat the consensus estimate by 1.5% and increased 12.9% year over year. Revenues, excluding billable expenses, were $1.77 billion, up 13% year over year.
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Fiserv's (FI) Q4 Earnings Surpass Estimates, Revenues Miss
Fiserv, Inc.(FI - Free Report) reported mixed fourth-quarter 2023 results, wherein earnings beat the Zacks Consensus Estimate while revenues missed the mark.
Adjusted earnings per share (excluding 40 cents from non-recurring items) of $2.19 exceeded the consensus mark by 1.9% and increased 14.7% year over year. Adjusted revenues of $4.64 billion missed the consensus estimate by 1.1% but increased slightly on a year-over-year basis.
Organic revenue growth was 12% in the quarter, driven by 24% and 4% growth in the Acceptance and Payments segments, respectively.
Other Quarterly Details
Processing and services’ revenues of $4.03 billion increased 8.3% year over year and beat our estimate by 1.3%. Revenues in the Product segment were $892 million, down 1.9% from the year-ago figure and missed our estimate by 1.5%.
Fiserv, Inc. Price, Consensus and EPS Surprise
Fiserv, Inc. price-consensus-eps-surprise-chart | Fiserv, Inc. Quote
Revenues from Merchant Acceptance were $2.11 billion, up 13.4% from the year-ago figure, beating our estimate by 7.1%. The Fintech segment reported revenues of $800 million, indicating a 2.8% decline from the year-ago figure and missed our estimated $827.2 million. The Payments segment reported revenues of $1.72 billion, reflecting growth of 3%. The figure compares with our estimated $1.81 billion.
The operating margin from the Merchant acceptance segment was 38.8%, up from the year-ago figure of 34.8%. Adjusted operating margin from the Payments segment was 51% compared with the year-ago figure of 48.5%. Operating margin from the Fintech segment was 37.9%, down from the year-ago 41.3%.
Balance Sheet and Cash Flow
Fiserv exited the fourth quarter of 2023 with cash and cash equivalents of $1.20 billion. Long-term debt was $22.36 billion. FISV generated $1.6 billion in net cash from operating activities while free cash flow was $1.3 billion. Capital expenditures were $354 million. The company repurchased 8.6 million shares for $1 billion in the quarter.
2024 Guidance
Adjusted earnings per share are anticipated to be in the range of $8.55-$8.7 while the Zacks Consensus Estimate of earnings is pegged at $8.58 per share, lower than the midpoint ($8.63) of the guided range. The company anticipates the earnings per share (EPS) growth to be in the band of 14-16%. FI expects total revenues to grow 6.5-8.5% while organic revenues are expected to grow 15-17% year over year.
Fiserv currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Earnings Snapshot
Gartner, Inc. (IT - Free Report) reported better-than-expected fourth-quarter 2023 results.
Adjusted EPS (excluding 40 cents from non-recurring items) of $3.04 beat the Zacks Consensus Estimate by 9.4% but decreased 18% from the year-ago reported figure. Revenues of $1.6 billion beat the consensus estimate by 0.6% and improved 5% year over year on a reported basis and 4% on a foreign-currency-neutral basis.
Total contract value was $4.8 billion, up 8% year over year on a foreign-currency-neutral basis.
Automatic Data Processing, Inc. (ADP - Free Report) reported impressive second-quarter fiscal 2024 results, wherein earnings and revenues beat the respective Zacks Consensus Estimate.
Adjusted EPS of $2.13 beat the consensus estimate by 1.4% and grew 8.7% from the year-ago fiscal quarter’s figure.
Total revenues of $4.67 billion surpassed the consensus estimate by 0.2% and improved 6.3% from the year-ago fiscal quarter’s reading on a reported basis as well on an organic constant-currency basis.
Booz Allen Hamilton Holding Corp. (BAH - Free Report) reported better-than-expected fourth-quarter fiscal 2024 results.
Quarterly adjusted EPS of $1.41 surpassed the Zacks Consensus Estimate by 24.8% and exceeded the year-ago quarter by 31.8%. The company reported revenues of $2.57 billion, which beat the consensus estimate by 1.5% and increased 12.9% year over year. Revenues, excluding billable expenses, were $1.77 billion, up 13% year over year.