Contract Award for Fiserv - Analyst Blog

By Zacks | June 06, 2012 AAA

  Recently announced, Fiserv, Inc. (FISV) was chosen for deploying its Common Origination Platform to Headland National Bank in Alabama. This was done with the clear intent of ameliorating the bank's lending process through better account processing services for its customers.

Fiserv's Common Origination Platform brings forth a comprehensive database of information regarding lending solutions catering to all customers. This allows for easy management and processing of loans at any institution it is installed in, directly improving its customer services.

Management averred that the formidable repute and increased expertise the company has retained in this area were the primary considerations behind the company's receiving this prestigious award. Fiserv had been serving Heatland National Bank since 1984 and this venture would only ossify their existing long-lasting relationship at a higher degree.

It appears that Fiserv has become a hot favourite for contract wins, especially for banks and financial institutions. On May 30, 2012, its Cleartouch platform was chosen by Magyar Bank in a multi-product contract. Furthermore, on May 23, 2012, U.S. Bank, a subsidiary of U.S. Bancorp (USB), decided to integrate its online banking platform with Fiserv's Mobiliti Enterprise mobile banking and payments solutions.

However, proactive moves by able competitors are aspects the company should remain wary of. On May 21, 2012, NPC, a subsidiary of Vantiv, Inc. (VNTV) was awarded a long- term Independent Sales Organization (ISO) contract from Strategic Payment Systems. Fiserv should keep a close watch on such advances made by its ominous rivals in the industry.

The Zacks Consensus Estimates for the second quarter and fiscal 2012 stand at $1.26 per share and $5.17 per share, respectively. At present we have a 'Neutral' recommendation on Fiserv. The stock carries a Zacks #3 Rank, which translates into a short-term rating of 'Hold'.

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