Fidelity National Information Services Faces Stock Struggles Amid Mixed Earnings
With a market cap of $36.1 billion, Fidelity National Information Services, Inc. (FIS) is a financial technology leader offering solutions to financial institutions, businesses, and developers across the globe. Based in Jacksonville, Florida, the company operates through three main segments: Banking Solutions, Capital Market Solutions, and Corporate and Other.
As a large-cap stock, FIS’s valuation exceeds $10 billion. The company is dedicated to advancing payment, banking, and investment methods while providing clients with fraud, risk management, and compliance solutions essential for business growth and security.
Stock Performance and Market Comparison
Recently, FIS has faced significant challenges in the stock market, having declined 24.2% from its 52-week high of $91.98. Over the past three months, shares have dropped 17.1%, underperforming the Financial Select Sector SPDR Fund (XLF), which decreased by 4.3% during the same period.
Looking at a broader timeline, FIS shares have only risen 1.2% over the past year, lagging behind the XLF’s 15.2% gain. Year-to-date, FIS has dropped 13.6%, while XLF has slipped by just 1.9% during the same timeframe.
FIS has been trading below its 50-day and 200-day moving averages since November of last year and January, respectively. This downward trend raises concerns among investors regarding the company’s momentum in the market.
Earnings Report Analysis
Despite reporting better-than-expected Q4 2024 adjusted earnings of $1.40 per share, FIS’s stock fell by 11.5% following the announcement on February 11. The revenue of $2.6 billion fell short of the consensus estimate, intensifying concerns about slower growth, particularly within the Banking Solutions segment. Additionally, the company provided a cautious revenue outlook for 2025, forecasting between $10.4 billion and $10.5 billion. This was compounded by a projected adjusted EBITDA margin of 41.3%, which was lower than expected. Investors also reacted negatively to the Q1 2025 EPS guidance of $1.17 to $1.22.
Competitive Landscape and Analyst Outlook
In contrast to FIS’s performance, International Business Machines Corporation (IBM) has shown strength. Over the past year, IBM shares surged 26.2% and gained 13.6% on a year-to-date basis.
Although FIS has underperformed compared to its industry peers over the past year, analysts remain cautiously optimistic about its future. Currently, FIS holds a consensus rating of “Moderate Buy” among the 30 analysts covering the stock. Furthermore, it is trading below the mean price target of $85.36, which could point to opportunities for potential investors.
On the date of publication, Sohini Mondal did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article are solely for informational purposes. For more information, please view the Barchart Disclosure Policy here.
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The views and opinions expressed herein are those of the author and do not necessarily reflect those of Nasdaq, Inc.
