Oppenheimer Upgrades Fiserv With $95 Target On Strong EPS, Cash Expectations

In a report published Friday, Oppenheimer analyst Gienn Greene upgraded the rating on Fiserv Inc FISV from Perform to Outperform, with a price target of $95. Fiserv is poised for robust incremental growth, driven by improved visibility in its base business and attain sustained annual margin expansion. The company is also expected to continue with its aggressive, shareholder friendly capital allocation. The company expects its revenue growth to accelerate from 2016-19, after three straight years of modest growth. "We expect FISV's adjusted EPS and FCF/share to grow at a sustained double-digit pace over the next few years. Finally, the bank end-market continues to normalize and bank technology spending should grow ~5% annually. We expect valuation levels to remain relatively stable, and expect share performance to directionally compound with FCF/share growth (i.e, low double-digits)," analyst Gienn Greene mentioned. In the report Oppenheimer noted, "FISV should enjoy scale benefits as revenue growth accelerates, and most of its newer solutions/opportunities should prove margin-accretive." The company is expected to continue its aggressive pace of share repurchases. The EPS estimates for FY15 and FY16 have been raised from $3.80 to $3.81 and from $4.25 to $4.30, respectively, to reflect more accretive capital allocation assumptions.