ACI Worldwide (ACIW): Is the Stock Still Undervalued After Strong Results and a New $500M Buyback?

ACI Worldwide (ACIW) just delivered a strong combination of news: higher revenue and profit for the recent quarter, an upgraded forecast for full-year revenue, plus a new $500 million share buyback plan. These moves are getting investor attention.

See our latest analysis for ACI Worldwide.

This string of upbeat announcements comes after a notable year for ACI Worldwide. The company recently expanded its payments platform through the acquisition of Payment Components and continued steady buyback activity. Despite near-term volatility, including a 7.4% drop in the most recent month, the company’s 90-day share price return is up nearly 10%, and its three-year total shareholder return tops 135%. Momentum appears to be building, with the latest financial upgrades and buyback signaling management’s confidence in future growth.

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With fresh financial momentum and a sizeable buyback now on the table, is ACI Worldwide’s impressive performance still offering investors a discount? Or is the market already reflecting all the upside potential in its share price?

Most Popular Narrative: 24% Undervalued

With ACI Worldwide's most widely watched narrative putting fair value at $64.60, there is a sizable gap from its last close at $48.96. This suggests the narrative sees significant upside, anchored by expectations of robust growth and operational leverage in the years ahead.

The official launch and positive customer reception of Connetic, ACI's next-generation cloud-native payments hub with AI-powered decisioning and real-time capabilities, positions the company to capitalize on increasing demand for scalable, secure digital payment processing and real-time payments globally. This supports accelerating recurring revenue growth and higher margins. ACI's established ability to facilitate alternative payment types, including stablecoins and digital currencies, enables it to capture new market opportunities as the complexity and adoption of digital payment methods rise. This is likely to translate into increased transaction volumes and elevated per-transaction economics, driving revenue uplift.

Read the complete narrative.

What would justify a target price so far above the market? The secret sauce behind this bullish narrative might be hidden in rising margins, lasting growth, or shrinking share counts. Find out which key trend could make the numbers add up and why analysts are betting big on future profits. Discover these bold underlying assumptions for yourself inside the full narrative.

Result: Fair Value of $64.60 (UNDERVALUED)

Have a read of the narrative in full and understand what's behind the forecasts.

However, intensifying competition and rapid shifts in digital payment technology could threaten ACI Worldwide’s growth outlook and challenge current margin expectations.

Find out about the key risks to this ACI Worldwide narrative.

Build Your Own ACI Worldwide Narrative

Take a closer look at the numbers yourself, test your own assumptions, and see how your perspective stacks up. Build a personalized view in minutes. Do it your way

A great starting point for your ACI Worldwide research is our analysis highlighting 5 key rewards and 1 important warning sign that could impact your investment decision.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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