Credit: Shutterstock photoFiserv, Inc.FISV is scheduled to report third-quarter 2018 results on Oct 31, after market close.
Shares of the company have rallied 20.4% in a year's time, significantly outperforming the Zacks S&P 500 Composite's rise of 3.8%.
Revenues to Improve Year Over Year
The Zacks Consensus Estimate for third-quarter revenues is pegged at $1.43 billion, reflecting a 2.2% improvement from the year-ago quarter's figure. The top line is expected to be driven by strength in card, biller and core account processing businesses. In the last reported quarter, revenues of $1.42 billion increased 2.5% on a year-over-year basis. Internal revenue growth was 6%.
Revenues in the Payments and Industry Products segment are likely to be driven by solid demand for Card Services, Biller Solutions businesses, Debit transaction, P2P transactions and Zelle transactions. The consensus estimate for revenues in the segment is pegged at $853 million, indicating year-over-year growth of 7.2%. In second-quarter 2018, segment revenues of $837 million increased 7.4% year over year.
Revenues in the Financial Institution Services segment are expected to suffer from impacts of divestitures. The consensus mark for revenues in the segment is pegged at $581 million, indicating year-over-year decline of 6.1%. In second-quarter 2018, segment revenues of $590 million fell 5.3% year over year.
Earnings Likely to Grow on Tax Benefits
The Zacks Consensus Estimate for earnings in the to-be-reported quarter is pegged at 77 cents per share, indicating year-over-year growth of 20.3%. Higher revenues, lower taxes and disciplined capital allocation will benefit Fiserv's earnings.
In second-quarter 2018, adjusted earnings of 75 cents per share increased 32% on a year-over-year basis.
Fiserv, Inc. Price and EPS Surprise
Fiserv, Inc. Price and EPS Surprise | Fiserv, Inc. Quote
Our Model Doesn't Suggest a Bea t
Please note that according to the Zacks model, a company with a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) has a good chance of beating estimates if it also has a positive Earnings ESP .
Fiserv has a Zacks Rank #3 and an Earnings ESP of -3.78%, a combination that makes surprise prediction difficult.
Stocks with a Zacks Rank #4 (Sell) or 5 (Strong Sell) are best avoided, especially if the companies are witnessing negative estimate revisions. You can uncover the best stocks to buy or sell before they're reported with our Earnings ESP Filter .
Stocks to Consider
Here are a few other stocks from the broader Business Services sector that investors may consider, as our model shows that these have the right combination of elements to beat on earnings in third-quarter 2018:
Clean Harbors, Inc. CLH has an Earnings ESP of +1.22% and a Zacks Rank of 1. The company is scheduled to report quarterly numbers on Oct 31. You can see the complete list of today's Zacks #1 Rank stocks here .
WEX Inc. WEX has an Earnings ESP of +0.15% and a Zacks Rank #2. The company is slated to report quarterly results on Oct 31.
Genpact Limited G has an Earnings ESP of +0.82% and a Zacks Rank #3. The company is scheduled to report quarterly numbers on Nov 6.
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Genpact Limited (G): Free Stock Analysis Report
Fiserv, Inc. (FISV): Free Stock Analysis Report
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
