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Fiserv Receives Contract Extension

Zacks Equity Research

Recently, Fiserv, Inc. (FISV) declared that BridgePortfolio, Inc., a Chicago-based Back Office Outsource Provider has extended its agreement with the company to deploy its Portfolio Management and Trading solutions platform. The tenure of the contract is for five-years. The company through its improved service offerings will provide updated wealth management solutions to BridgePortfolio.

BridgePortfolio, with approximately $2 billion in assets, has chosen Fiserv having duly recognized its highly developed technology with flexible, scalable and customized systems.

Fiserv’s management expressed its satisfaction with the association by stating that its Portfolio Management and Trading service portal will not only cater to BridgePortfolio’s requirements but also assist its business prospects moving ahead.  

The company appears quite proactive in winning contracts of late. On July 31, 2012, the company’s Common Origination Platform has been adopted by MCNB Trust & Co. This was done with the clear intent of ending the account process management system of MCNB Trust and offering enhanced services to its customer. These acquisitions are likely to be major growth drivers for the company going forward.

However, it is always wise for Fiserv to be cautious of competitive strides in the industry. Formidable players to take note of in this regard include Mastercard Incorporated (MA), Fidelity National Information Services, Inc. (FIS) and Total System Services, Inc. (TSS). Moreover, Fiserv faces an ongoing threat from billers and self-sufficient financial institutions that develop and use their own electronic payment transactions and Internet banking solutions.

The current Zacks Consensus Estimates for Fiserv, Inc. are $1.27 and $5.18 for the third quarter of 2012 and for fiscal 2012, respectively. The estimates represent a year-over-year growth of 9.82% for the third quarter and 13.06% for 2012.

We currently have a long-term recommendation of Neutral for Fiserv. The stock also bears a Zacks #3 Rank, which translates into a short-term rating of Hold.

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