Major Decision: Guy Chiarello Exercises Options, Realizing $6.61M At Fiserv

On March 21, it was revealed in an SEC filing that Guy Chiarello, Chief Operating Officer at Fiserv FI executed a significant exercise of company stock options.

What Happened: Chiarello, Chief Operating Officer at Fiserv, made a strategic move by exercising stock options for 63,646 shares of FI as detailed in a Form 4 filing on Thursday with the U.S. Securities and Exchange Commission. The transaction value amounted to $6,605,818.

Fiserv shares are trading up 0.41% at $157.0 at the time of this writing on Friday morning. Since the current price is $157.0, this makes Chiarello's 63,646 shares worth $6,605,818.

Get to Know Fiserv Better

Fiserv is a leading provider of core processing and complementary services, such as electronic funds transfer, payment processing, and loan processing, for US banks and credit unions, with a focus on small and midsize banks. Through the merger with First Data in 2019, Fiserv also provides payment processing services for merchants. About 10% of the company's revenue is generated internationally.

Financial Insights: Fiserv

Revenue Growth: Fiserv's revenue growth over a period of 3 months has been noteworthy. As of 31 December, 2023, the company achieved a revenue growth rate of approximately 6.18%. This indicates a substantial increase in the company's top-line earnings. As compared to its peers, the revenue growth lags behind its industry peers. The company achieved a growth rate lower than the average among peers in Financials sector.

Profitability Metrics: Unlocking Value

• Gross Margin: The company excels with a remarkable gross margin of 62.54%, indicating superior cost efficiency and profitability compared to its industry peers.

• Earnings per Share (EPS): Fiserv's EPS outshines the industry average, indicating a strong bottom-line trend with a current EPS of 1.45.

Debt Management: Fiserv's debt-to-equity ratio is below the industry average at 0.78, reflecting a lower dependency on debt financing and a more conservative financial approach.

Exploring Valuation Metrics Landscape:

• Price to Earnings (P/E) Ratio: Fiserv's P/E ratio of 31.4 is below the industry average, suggesting the stock may be undervalued.

• Price to Sales (P/S) Ratio: The Price to Sales ratio is 5.04, which is lower than the industry average. This suggests a possible undervaluation based on sales performance.

• EV/EBITDA Analysis (Enterprise Value to its Earnings Before Interest, Taxes, Depreciation & Amortization): The company's EV/EBITDA ratio of 14.25 trails industry averages, indicating a potential disparity in market valuation that could be advantageous for investors.

Market Capitalization: Exceeding industry standards, the company's market capitalization places it above industry average in size relative to peers. This emphasizes its significant scale and robust market position.

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Why Insider Activity Matters in Finance

Insider transactions serve as a piece of the puzzle in investment decisions, rather than the entire picture.

In the realm of legality, an "insider" is defined as any officer, director, or beneficial owner holding more than ten percent of a company's equity securities under Section 12 of the Securities Exchange Act of 1934. This includes executives in the c-suite and major hedge funds. These insiders are required to disclose their transactions through a Form 4 filing, to be submitted within two business days of the transaction.

Notably, when a company insider makes a new purchase, it is considered an indicator of their positive expectations for the stock.

Conversely, insider sells may not necessarily signal a bearish stance on the stock and can be motivated by various factors.

Exploring Key Transaction Codes

In the domain of transactions, investors frequently turn their focus to those taking place in the open market, as meticulously outlined in Table I of the Form 4 filing. A P in Box 3 indicates a purchase, while S signifies a sale. Transaction code C signals the conversion of an option, and transaction code A denotes a grant, award, or other acquisition of securities from the company.

Check Out The Full List Of Fiserv's Insider Trades.

This article was generated by Benzinga's automated content engine and reviewed by an editor.