Fiserv Inc (FISV)

The new CEO inherited a total mess. Extremely low valuations don't show value but signal problems. It will be dead money for a long time.

They need to merge with a company. There are too many fintech companies.

Has long owned this. New management is executing well. Has huge free cash flow. Trades at 6x PE and 16% free cash flow level. She added more last month. The numbers are there. Banks depend on them and AI can't replace them.

Has high free cash flow yields above 5%.  Trades at only 7x PE, very low. The new CEO is doing a great job so far. A good time to enter this.

He can't value these companies which the markets have punished. Capital allocation has improvement, but doesn't know if that is enough.

Huge moat in terms of backbone -- back-end processing platform for billions of transactions per year. The business isn't going away, but what's the valuation? Definitely worth more than current trading price (though not sure about Morningstar's prediction of double). So he's held on, though down substantially.

Lost 67% last year, mostly last October when they slashed their full-year forecast and shook-up management.

Fell 68% last year. Is trading at a super-low valuation. Has a built-in technology at all the major banks. Yes, they had a major stumble, concerning sales in Argentina. They have things like Clover. Still an amazing company with strong cash flow. If they return to around 10% earnings growth at the current PE, hold onto it. The new CEO is excellent.

Used to control the market, now facing competition and that will continue. That's what caused the stock to fall. What's the next phase of their growth? That's where the investor has to pay attention. Not a place to be.

With good growth expected and at 23X earnings, we think it looks good. The stock has done well over the past year and is up nicely in 2025. Note that leverage is fairly high and the Q1 may look weaker because of tough year over year comparisons as last year's Q1 was very strong. But we think it is fine overall assuming a decent holding period. 
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Following the stock's pullback amid the CEO's departure, several analysts have increased their price targets on the company today, and we view this pullback as a good long-term buying opportunity. We continue to view the company as a high-quality name, and while there is increased uncertainty around its future given the CEO's departure, it has had four CEOs since 1984, all while its shares have generally traded up and to the right.
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Better than it used to be, spinout makes a lot of sense. But at the end of the day, servicing an end market that's not growing and they're trying to sell more into it. Open to risk from other players that have pure-play solutions. More reasons to be negative than positive.