Guy Chiarello Exercises Options, Realizes $8.63M

A significant insider transaction involving the exercise of company stock options was reported on February 20, by Guy Chiarello, Chief Operating Officer at Fiserv FI, as per the latest SEC filing.

What Happened: A Form 4 filing with the U.S. Securities and Exchange Commission on Thursday revealed that Chiarello, Chief Operating Officer at Fiserv in the Financials sector, exercised stock options for 45,000 shares of FI stock. The exercise price of the options was $41.33 per share.

Fiserv shares are currently trading down by 0.52%, with a current price of $233.2 as of Friday morning. This brings the total value of Chiarello's 45,000 shares to $8,634,150.

Unveiling the Story Behind Fiserv

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.

Unraveling the Financial Story of Fiserv

Positive Revenue Trend: Examining Fiserv's financials over 3 months reveals a positive narrative. The company achieved a noteworthy revenue growth rate of 0.69% as of 31 December, 2024, showcasing a substantial increase in 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.

Analyzing Profitability Metrics:

• Gross Margin: Achieving a high gross margin of 61.55%, the company performs well in terms of cost management and profitability within its sector.

• Earnings per Share (EPS): Fiserv's EPS is significantly higher than the industry average. The company demonstrates a robust bottom-line performance with a current EPS of 1.648742.

Debt Management: Fiserv's debt-to-equity ratio is below the industry average at 0.92, reflecting a lower dependency on debt financing and a more conservative financial approach.

Financial Valuation Breakdown:

• Price to Earnings (P/E) Ratio: With a lower-than-average P/E ratio of 43.57, the stock indicates an attractive valuation, potentially presenting a buying opportunity.

• Price to Sales (P/S) Ratio: A higher-than-average P/S ratio of 6.67 suggests overvaluation in the eyes of investors, considering sales performance.

• EV/EBITDA Analysis (Enterprise Value to its Earnings Before Interest, Taxes, Depreciation & Amortization): With an EV/EBITDA ratio lower than industry averages at 17.57, Fiserv could be considered undervalued.

Market Capitalization Analysis: The company's market capitalization is above the industry average, indicating that it is relatively larger in size compared to peers. This may suggest a higher level of investor confidence and market recognition.

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Exploring the Significance of Insider Trading

Insightful as they may be, insider transactions should be considered alongside a thorough examination of other investment criteria.

When discussing legal matters, the term "insider" refers to any officer, director, or beneficial owner holding more than ten percent of a company's equity securities, as stipulated in Section 12 of the Securities Exchange Act of 1934. This includes executives in the c-suite and significant hedge funds. Such insiders are required to report their transactions through a Form 4 filing, which must be completed within two business days of the transaction.

A new purchase by a company insider is a indication that they anticipate the stock will rise.

On the other hand, insider sells may not necessarily indicate a bearish view and can be motivated by various factors.

The Insider's Guide to Important Transaction Codes

Delving into transactions, investors typically prioritize those unfolding in the open market, as precisely 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.

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