Is It Too Late To Consider Buying Fiserv, Inc. (NASDAQ:FISV)?

Let's talk about the popular Fiserv, Inc. (NASDAQ:FISV). The company's shares received a lot of attention from a substantial price movement on the NASDAQGS over the last few months, increasing to US$127 at one point, and dropping to the lows of US$107. Some share price movements can give investors a better opportunity to enter into the stock, and potentially buy at a lower price. A question to answer is whether Fiserv's current trading price of US$110 reflective of the actual value of the large-cap? Or is it currently undervalued, providing us with the opportunity to buy? Let’s take a look at Fiserv’s outlook and value based on the most recent financial data to see if there are any catalysts for a price change.

See our latest analysis for Fiserv

What's the opportunity in Fiserv?

According to my valuation model, Fiserv seems to be fairly priced at around 15% below my intrinsic value, which means if you buy Fiserv today, you’d be paying a fair price for it. And if you believe that the stock is really worth $129.55, then there isn’t much room for the share price grow beyond what it’s currently trading. What's more, Fiserv’s share price may be more stable over time (relative to the market), as indicated by its low beta.

Can we expect growth from Fiserv?

Investors looking for growth in their portfolio may want to consider the prospects of a company before buying its shares. Although value investors would argue that it’s the intrinsic value relative to the price that matter the most, a more compelling investment thesis would be high growth potential at a cheap price. With profit expected to more than double over the next couple of years, the future seems bright for Fiserv. It looks like higher cash flow is on the cards for the stock, which should feed into a higher share valuation.

What this means for you:

Are you a shareholder? It seems like the market has already priced in FISV’s positive outlook, with shares trading around its fair value. However, there are also other important factors which we haven’t considered today, such as the financial strength of the company. Have these factors changed since the last time you looked at the stock? Will you have enough confidence to invest in the company should the price drop below its fair value?

Are you a potential investor? If you’ve been keeping tabs on FISV, now may not be the most optimal time to buy, given it is trading around its fair value. However, the positive outlook is encouraging for the company, which means it’s worth further examining other factors such as the strength of its balance sheet, in order to take advantage of the next price drop.

So if you'd like to dive deeper into this stock, it's crucial to consider any risks it's facing. To that end, you should learn about the 3 warning signs we've spotted with Fiserv (including 1 which can't be ignored).

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This article by Simply Wall St is general in nature. 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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