TD Cowen has reaffirmed its positive stance on Fiserv (NYSE:FI), a leading financial services technology company, by raising its price target on the company's stock to $182 from $175 while maintaining a Buy rating.
The firm's analyst, on Thursday, noted Fiserv's consistent performance and its success in executing its product strategy and distribution.
Fiserv has been recognized for its strong product execution and expansive distribution capabilities, which have contributed to its position as a prominent player in the payment processing industry, said the analyst, adding that the company's ability to consistently win in the market has been underlined by the analyst's remarks.
The analyst expressed clear confidence in Fiserv's financial year 2024 outlook, citing a strong conviction in the company's potential to maintain double-digit earnings per share growth over the medium term.
Fiserv reported an impressive 18% year-over-year organic revenue growth in its second quarter, marking the fourth consecutive quarter of double-digit growth. As a result, B.Riley has maintained a Buy rating on Fiserv and raised the price target to $185. Similarly, Argus has lifted its price target to $187 following robust earnings and an enhanced financial outlook for 2024.
Fiserv's second-quarter earnings saw a significant increase of 31%, leading to an upward revision of its full-year profit forecast. The company's processing and services revenue rose to $4.14 billion, while total quarterly revenue increased by 7.4% to $5.12 billion, exceeding estimates.
InvestingPro Insights
TD Cowen's bullish outlook on Fiserv is echoed by the InvestingPro analysis, which highlights the company's attractive valuation and its position as a key industry player. With a P/E ratio of 27.79, Fiserv is trading at a low P/E relative to near-term earnings growth, suggesting the stock could be undervalued given the company's growth prospects. This aligns with the analyst's view of Fiserv's ability to sustain double-digit earnings per share growth. Additionally, the company's status as a prominent player in the Financial Services industry is reinforced by its consistent profitability, with a robust gross profit margin of 60.96% in the last twelve months as of Q2 2024.
Investors should note that Fiserv is trading near its 52-week high, with the price at 98.95% of the peak, reflecting the market's positive sentiment towards the company. The stock's recent performance also includes a 23.91% one-year price total return, indicating strong momentum. For those looking for more insights, there are 7 additional InvestingPro Tips available, which could provide further depth into Fiserv's financial health and future prospects.
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