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Fidelity National (FIS) Beats Q4 Earnings on Lower Expenses

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Have you been eager to see how Fidelity National Information Services, Inc. (FIS - Free Report) performed in Q4 in comparison with the market expectations? Let’s quickly scan through the key facts from this Florida-based financial services technology company’s earnings release this morning:

An Earnings Beat

Fidelity came out with adjusted earnings per share of $1.36, beating the Zacks Consensus Estimate of $1.34. Results excluded certain one-time items and benefit related to tax reform. Results reflected lower selling, general and administrative expenses, partially offset by decline in revenues.

How Was the Estimate Revision Trend?

You should note that the earnings estimate for Fidelity depicted neutral stance prior to the earnings release. The Zacks Consensus Estimate has remained unchanged at $1.34 over the last seven days.

However, Fidelity has a decent earnings surprise history. Before posting earnings beat in Q4, the company delivered positive surprises in three of the trailing four quarters. Overall, the company surpassed the Zacks Consensus Estimate by an average of 5.3% in the trailing four quarters.

Fidelity National Information Services, Inc. Price and EPS Surprise

Fidelity National Information Services, Inc. Price and EPS Surprise | Fidelity National Information Services, Inc. Quote

Revenue Came In Lower Than Expected

Fidelity posted revenues of $2.33 billion, which lagged the Zacks Consensus Estimate of $2.37 billion. Also, revenues decreased 4.7% year over year.

Key Takeaways:

  • The Tax Cuts and Jobs Act resulted in a net tax benefit of $781 million or $2.32 per share to net earnings from continuing operations attributable to common stockholders
  • Adjusted EBITDA margin expanded 340 basis points to 37.8%
  • Selling, general and administrative expenses declined 26.1% year-over-year to $340 million
  • Management expects consolidated organic revenue growth of 2.5-3.5% in 2018
     

What Zacks Rank Says

The estimate revisions that we discussed earlier have driven a Zacks Rank #3 (Hold) for Fidelity. However, since the latest earnings performance is yet to be reflected in the estimate revisions, the rank is subject to change. While things apparently look favorable, it all depends on what sense the just-released report makes to the analysts.

(You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.)

Check back later for our full write up on this Fidelity earnings report!

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