4 Fidelity National Information Services Analysts On Q4 Earnings: 'Spinoff And Guidance Are All That Matters'

Shares of Fidelity National Information Services Inc FIS rose in early trading on Tuesday, after the company reported its quarterly results and the spinoff of its merchant business.

Keefe, Bruyette & Woods on Fidelity National Information Services

Analyst Vasundhara Govil maintained a Market Perform rating and price target of $70.

“As feared, FIS’s 4Q earnings has proven to be a negative catalyst given structural and macro challenges faced by the Merchant and Banking segments respectively, which are meaningfully dampening the near-term earnings power of the company,” Govil said.

“With the announcement of the merchant business spin-off this morning, management is forging a path forward to unlock value of the core processing franchise, while also allowing for better allocation of capital and management resources to turn around the merchant business,” he added.

Bernstein on Fidelity National Information Services

Analyst Harshita Rawat reiterated a Market Perform rating and price target of $70.

“FIS reported an underwhelming set of results this morning,” Rawat said in a note. “While the merchant spin was welcome (and somewhat expected) news, the guidance and merchant business performance was much worse than expected,” she added.

Check out other analyst stock ratings.

RBC Capital Markets on Fidelity National Information Services

Analyst Daniel Perlin reaffirmed an Outperform rating while reducing the price target from $93 to $81.

“Spinoff and guidance are all that matters, as the Worldpay (Merchant) spinoff is designed to course correct its share-losing SMB business, while disappointing guidance assumes a global recession (including US & UK), coupled with merchant margin compression,” Perlin wrote in a note.

“We believe the spinoff could occur before management’s 12-month window given the cruciality of near-term M&A opportunities to enhance its SMB business,” the analyst said. “FY23 guidance is likely a kitchen sink event, unless a global recession occurs,” he added.

Wells Fargo on Fidelity National Information Services

Analyst Jeff Cantwell maintained an Equal-Weight rating while lowering the price target from $67 to $65.

“We struggle with this breakup given all the moving pieces yet to be resolved, the downbeat revenue/EPS outlook, and no credible 'share gain' story,” Cantwell said. “Silver lining is the guide looks conservative,” he added.

FIS Price Action: Shares of Fidelity National Information Services had risen by 2.44% to $67.65 at the time of publication Monday.

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