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What's in the Store for Fidelity National's (FIS) Q3 Earnings?

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Fidelity National Information Services (FIS - Free Report) is scheduled to release third-quarter 2019 earnings on Nov 5, before the opening bell. The company’s earnings and revenues are expected to reflect year-over-year growth.

Notably, Fidelity delivered positive earnings surprises in three of the trailing four quarters, the average beat being 2.01%.

In the last reported quarter, the company’s results were in line with the Zacks Consensus Estimate. Organic revenue growth, lower expenses and expanding margin were the key tailwinds. However, huge outstanding debt posed a headwind. Also, poor performance of Global Financial Solutions segment was a chief concern.

 

Factors at Play

Fidelity is likely to display a disappointing revenue-growth performance for the July-September quarter due to stiff competition in the industry. Per the consensus estimate, Global Financial Solutions revenues might display a year-over-year (y/y) decline of 1.7% to $900 million, though revenues from Integrated Financial Solutions will likely reflect 4.8% y/y growth to $1.14 billion. Also, overall revenues of $2.8 billion are projected to be up 34.4% from the prior-year quarter.

This Florida-based financial service provider’s bottom-line results might disappoint on fall in interest rates.

The company’s focus on introducing fresh and innovative products in order to meet customers’ rising demand might have escalated expenses.

Fidelity’s shares have gained around 6.5% in the three-month period ended Sep 30, 2019, compared with the industry’s growth of 0.5%.

Will the upcoming earnings release give a boost to Fidelity’s stock? That depends largely on whether or not the firm is able to impress the market with its third-quarter results.

Here is what our quantitative model predicts:

Fidelity has the right combination of the two key ingredients — a positive Earnings ESP and Zacks Rank #3 (Hold) or higher — for increasing the odds of an earnings beat.

You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Earnings ESP: The Earnings ESP is currently pegged at +0.13%.

Zacks Rank: It carries a Zacks Rank of 3, which increases the predictive power of ESP.

Notably, for the third quarter, the Zacks Consensus Estimate for earnings indicates a 1.5% jump on a year-over-year basis.

Other Stocks That Warrant a Look

Cohen & Steers Inc (CNS - Free Report) has been witnessing upward estimate revisions, for the past 30 days. Moreover, this Zacks #1 Ranked (Strong Buy) stock has rallied more than 29%, in the past six months. You can see the complete list of today’s Zacks #1 Rank stocks here.

Legg Mason, Inc. (LM - Free Report) has been witnessing upward estimate revisions, for the past 30 days. Also, the company’s shares have gained nearly 10.5% in six months’ time. At present, it carries a Zacks Rank of 2 (Buy).

Federated Investors, Inc. (FII - Free Report) has been witnessing upward estimate revisions for the past 30 days. Additionally, the stock has jumped around 2.1% over the past six months. It currently holds a Zacks Rank #2.

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