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What's in Store for Fidelity National (FIS) Q1 Earnings?

Zacks Equity Research

Fidelity National Information Services FIS is scheduled to release first-quarter 2019 earnings on Apr 30, before the opening bell. While the company’s earnings are expected to reflect year-over-year growth, revenues may have witnessed a decline.

Notably, Fidelity delivered positive earnings surprises in each of the trailing four quarters, the average beat being 2.72%.

Fidelity National Information Services, Inc. Price and EPS Surprise

Fidelity National Information Services, Inc. Price and EPS Surprise | Fidelity National Information Services, Inc. Quote

In the last reported quarter, the company pulled off a positive earnings surprise of 1.27%. Results benefited from lower expenses, marginal growth in GAAP in revenues and expansion of net interest margin. However, huge outstanding debt remained a headwind.

Factors to Influence Q1 Results

Fidelity’s revenue growth performance for the January-March quarter is unlikely to be impressive due to stiff competition in the industry. Per the consensus estimate, Global Financial Solutions revenues are likely to slip around 7.6% to $857 million, though revenues from Integrated Financial Solutions are expected to increase 4.7% year over year to $1.11 billion. Also, the overall top line of $2 billion is projected to be down 2.5% from the prior-year quarter.

The Florida-based financial service provider’s bottom line might benefit slightly from lower tax rates and a rising interest-rate environment.

The company’s focus on introducing fresh and innovative products in order to meet the rising demand of customers may escalate expenses.

Fidelity’s shares have gained around 10.3% in the three-month period ended Mar 31, 2019, compared with the industry’s growth of 21.9%.

Will the upcoming earnings release give a boost to Fidelity’s stock? That depends largely on whether or not the firm is able to impress the market with its first-quarter results.

Here is what our quantitative model predicts:

Fidelity does not have the right combination of two key ingredients — a positive Earnings ESP and Zacks Rank #3 (Hold) or higher — for increasing the odds of an earnings beat.

You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Earnings ESP: The Earnings ESP is currently pegged at 0.00%.

Zacks Rank: It carries a Zacks Rank #3, which increases the predictive power of ESP. But we need to have positive earnings ESP to be sure of an earnings beat.

Notably, for the first quarter, the Zacks Consensus Estimate for earnings indicates 44% growth on a year-over-year basis.

Stocks That Warrant a Look

Here are some other stocks you may want to consider, as according to our model, these have the right combination of elements to post an earnings beat this quarter.

Axos Financial, Inc. AX is slated to release results on Apr 30. It has an Earnings ESP of +0.26% and currently carries a Zacks Rank #3. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Grupo Financiero Galicia S.A. GGAL is scheduled to report earnings on May 29. It has an Earnings ESP of +4.76% and carries a Zacks Rank #3.

Solar Capital Ltd. SLRC has an Earnings ESP of +4.07% and holds a Zacks Rank #2. It is set to release quarterly numbers on May 6.

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Grupo Financiero Galicia S.A. (GGAL) : Free Stock Analysis Report
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