On Monday, Baird increased its price target on Fiserv (NYSE:FI), a leading global provider of payments and financial services technology solutions, from $168 to $185 while maintaining an Outperform rating. This adjustment follows a review of the company's recent 8-K filing and its new business segmentation.
The firm's analyst stated that the revision of the price target to $185 is based on the outlook for the 12 months ending June 30, 2026. The analyst affirmed that the current EBIT (earnings before interest and taxes) or EPS (earnings per share) estimates remain unchanged despite the new segmentation.
Fiserv has recently updated its business segments, which now include Banking, Digital Payments, and Issuing for Financial Solutions as well as SMB (Small and Medium Business), Enterprise, and Processing for Merchant. The analyst expressed a positive view of the stock and indicated the availability of Baird's updated model, which includes these sub-segments.
The company's strategic reorganization aims to enhance its focus on key growth areas and improve its service delivery to clients. The new segmentation is expected to provide clearer visibility into the company's operational performance and growth drivers.
Fiserv continues to be a notable player in the financial technology space, with Baird's updated price target reflecting confidence in the company's future performance. The firm's Outperform rating suggests that Fiserv's stock may perform better than the broader market or its sector in the upcoming period.
InvestingPro Insights
Following Baird's updated price target and optimistic outlook on Fiserv, current real-time data from InvestingPro provides additional context for investors considering the company's stock. The market capitalization of Fiserv stands at a robust $94.36 billion, underlining its significant presence in the financial technology sector. With a P/E ratio of 31.76, the company is trading at a high earnings multiple, which is echoed by its adjusted P/E ratio for the last twelve months as of Q4 2023 at 32.16. This is indicative of high investor expectations for future earnings growth.
The company has demonstrated solid revenue growth of 7.65% over the last twelve months as of Q4 2023, with its gross profit margin impressively at 59.83%, showcasing the efficiency of its operations. Moreover, Fiserv has experienced a substantial price uptick with a 6-month total return of 41.48%, reflecting strong investor confidence and market performance.
InvestingPro Tips highlight that Fiserv is trading near its 52-week high, with the price at 99.89% of this peak, and has shown a strong return over the last three months, which aligns with the positive sentiment expressed by Baird. Additionally, the company's stock generally trades with low price volatility, which may appeal to investors looking for stability.
For those seeking a deeper dive into Fiserv's financials and market performance, more InvestingPro Tips are available, which could further inform investment decisions. To explore these tips and benefit from the insights, visit the dedicated section on InvestingPro for Fiserv at https://www.investing.com/pro/FI. Remember to use the coupon code PRONEWS24 to get an additional 10% off a yearly or biyearly Pro and Pro+ subscription.
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