In December 2018, Fidelity National Information Services, Inc. (NYSE:FIS) released its earnings update. Generally, the consensus outlook from analysts appear fairly confident, with profits predicted to increase by 40% next year relative to the past 5-year average growth rate of 19%. By 2020, we can expect Fidelity National Information Services’s bottom line to reach US$1.2b, a jump from the current trailing-twelve-month of US$846m. In this article, I’ve outline a few earnings growth rates to give you a sense of the market sentiment for Fidelity National Information Services in the longer term. Investors wanting to learn more about other aspects of the company should research its fundamentals here.
How will Fidelity National Information Services perform in the near future?
Over the next three years, it seems the consensus view of the 18 analysts covering FIS is skewed towards the positive sentiment. Broker analysts tend to forecast up to three years ahead due to a lack of clarity around the business trajectory beyond this. To reduce the year-on-year volatility of analyst earnings forecast, I’ve inserted a line of best fit through the expected earnings figures to determine the annual growth rate from the slope of the line.
By 2022, FIS’s earnings should reach US$1.4b, from current levels of US$846m, resulting in an annual growth rate of 18%. EPS reaches $4.62 in the final year of forecast compared to the current $2.58 EPS today. Margins are currently sitting at 10%, which is expected to expand to 15% by 2022.
Future outlook is only one aspect when you’re building an investment case for a stock. For Fidelity National Information Services, I’ve put together three relevant factors you should further research:
- Financial Health: Does it have a healthy balance sheet? Take a look at our free balance sheet analysis with six simple checks on key factors like leverage and risk.
- Valuation: What is Fidelity National Information Services worth today? Is the stock undervalued, even when its growth outlook is factored into its intrinsic value? The intrinsic value infographic in our free research report helps visualize whether Fidelity National Information Services is currently mispriced by the market.
- Other High-Growth Alternatives : Are there other high-growth stocks you could be holding instead of Fidelity National Information Services? Explore our interactive list of stocks with large growth potential to get an idea of what else is out there you may be missing!
We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.
If you spot an error that warrants correction, please contact the editor at firstname.lastname@example.org. 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. Simply Wall St has no position in the stocks mentioned. Thank you for reading.