Financial Data and Key Metrics Changes - The company reported adjusted revenue growth of 4% in Q1 2025, exceeding expectations [8][18] - Adjusted EBITDA was $958 million, leading to an EBITDA margin of 37.8% [18] - Adjusted EPS grew 11% to $1.21, at the upper end of the outlook [10][18] - Free cash flow conversion exceeded 70%, with free cash flow of $368 million compared to $95 million last year [9][19] - The company returned $670 million to shareholders through share repurchases and dividends [10][19] Business Line Data and Key Metrics Changes - Banking segment revenue grew 2%, with recurring revenue growth at 3% [21] - Capital Markets segment saw adjusted revenue growth of 9%, with recurring revenue growth of 6% [22] - Non-recurring revenue in Capital Markets advanced 47%, driven by strong license renewals [22] Market Data and Key Metrics Changes - The company signed several new marquee engagements across the money lifecycle, indicating strong demand for core solutions [10][11] - The digital solutions segment gained traction, with a Midwest community bank selecting the Digital One product [12] - The Office of the CFO capabilities expanded, with a multinational engineering firm selecting FIS's treasury management solution [13] Company Strategy and Development Direction - The company is focused on driving commercial excellence and simplifying its portfolio, which is expected to deliver consistent financial results [7] - The strategic acquisition of the Global Payments Issuer Business and the sale of the minority stake in Worldpay are aimed at strengthening the financial profile and value proposition [7][16] - The acquisition is expected to be accretive to adjusted EPS, EBITDA margins, and free cash flow in the first twelve months [17] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the pipeline, noting that client spending remains strong despite macroeconomic factors [32] - The company reaffirmed its full-year outlook, anticipating continued strength in recurring revenue growth [9][24] - Management highlighted the importance of high retention rates and strong sales from the previous year as drivers for future growth [90] Other Important Information - The company is targeting adjusted revenue growth of 4.2% to 5% for Q2 2025 [24] - Capital expenditures were $233 million in Q1 2025, consistent with full-year expectations [19] - The company exited the quarter at a target leverage of 2.8 times [19] Q&A Session Summary Question: Feedback on client decision-making pipeline and Issuer Solutions business - Management noted that client conversions are live and the pipeline is increasing significantly year-over-year, with no signs of slowing spend [31][32] Question: Outlook for Capital One and Discover - Management expressed positive sentiments regarding partnerships with Capital One and Discover, indicating strong support for their initiatives [36] Question: Drivers for Capital Markets Q2 guidance - Management explained that the first quarter had a high non-recurring benefit, and the second quarter guidance reflects a return to normalized levels [40][41] Question: Banking segment's combined debit issuing business - Management indicated that the banking segment will see a significant increase in scale and recurring revenue due to the acquisition [45][46] Question: Worldpay EMI outlook - Management confirmed that the Worldpay EMI outlook remains consistent with expectations, with no signs of softening [50][51] Question: Cost synergies from the acquisition - Management highlighted that the largest cost synergies would come from rationalizing duplicate vendor costs and back-office optimization [58][60] Question: Accretion from Issuer Solutions transaction - Management stated that the transaction is immediately accretive and will significantly enhance cash flow and banking revenue [69][70] Question: Free cash flow and working capital initiatives - Management reported significant improvements in cash flow due to net working capital optimization initiatives [98][99] Question: Sales progress in capital markets - Management noted strong opportunities in both traditional and non-traditional verticals, with a robust pipeline and execution [106]

Financial Performance - Q1 2025 - Adjusted revenue grew by 4%[8, 17] - Adjusted EBITDA margin was 37.8%[8, 17], a decrease of 142 bps[17] - Adjusted EPS increased by 11% to $1.21[8, 17] - Adjusted Free Cash Flow was $368 million, representing a 71% conversion rate[18] Capital Allocation - $670 million was returned to shareholders in Q1 2025, including $450 million in share buybacks[8] - The company is confident in achieving its full-year (FY) free cash flow target[8] Segment Performance - Q1 2025 - Banking Solutions revenue grew by 3%, with recurring revenue up by 2%[20] - Capital Markets revenue grew by 6%, with recurring revenue up by 9%[20] - Banking Solutions adjusted EBITDA margin was 40.1%, a decrease of 379 bps[20] - Capital Markets adjusted EBITDA margin was 48.3%, an increase of 90 bps[20] FY 2025 Outlook (Reaffirmed) - Revenue is projected to be between $10.435 billion and $10.495 billion, representing adjusted revenue growth of 4.6% to 5.2%[21] - Adjusted EBITDA is expected to be between $4.305 billion and $4.335 billion, with a margin of approximately 41.3%[21] - Adjusted EPS is projected to be between $5.70 and $5.80, representing growth of 9% to 11%[21] Q2 2025 Outlook - Revenue is projected to be between $2.560 billion and $2.585 billion, representing adjusted revenue growth of 4.2% to 5.0%[21] - Adjusted EBITDA is expected to be between $1.020 billion and $1.035 billion, with a margin of 39.8% to 40.0%[21] - Adjusted EPS is projected to be between $1.34 and $1.38[21]

Core Viewpoint - Fidelity National Information Services, Inc. (FIS) is expected to report first-quarter 2025 results on May 6, 2025, with earnings estimated at $1.20 per share and revenues at $2.5 billion, indicating a year-over-year earnings increase of 9.1% and revenue growth of 1.7% [1][2] Financial Performance Estimates - The Zacks Consensus Estimate for FIS's 2025 revenues is $10.5 billion, reflecting a year-over-year rise of 3.4%, while the EPS for the current year is estimated at $5.74, indicating a growth of approximately 10% year-over-year [2] - FIS has consistently beaten consensus estimates in the last four quarters, with an average surprise of negative 9.4% [2] Earnings Prediction - The company is predicted to likely beat earnings this quarter, supported by a positive Earnings ESP of +0.76% and a Zacks Rank of 2 (Buy) [3] Revenue Breakdown - The consensus estimate for Banking Solutions revenues indicates a 1.3% year-over-year increase, while Capital Market Solutions is expected to see a revenue increase of around 7% compared to the same quarter last year [5] - Total Recurring revenues are projected to grow by approximately 1%, with North America and All Other revenues expected to grow by 1% and 2% year-over-year, respectively [6][7] EBITDA Estimates - The adjusted EBITDA for Capital Market Solutions is estimated to increase by 7.5% year-over-year, while total operating expenses are expected to decline by 2.8% year-over-year [7] - The company anticipates adjusted EBITDA to be in the range of $940-$960 million, with an adjusted EBITDA margin projected between 37.8-38.2% [9] Challenges - The adjusted EBITDA for Banking Solutions is expected to decline by 2.5% year-over-year, which may offset some positive growth factors [8]

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Investors interested in Financial Transaction Services stocks are likely familiar with Fidelity National Information Services (FIS) and Payoneer Global Inc. (PAYO) . But which of these two stocks is more attractive to value investors? We'll need to take a closer look to find out.Everyone has their own methods for finding great value opportunities, but our model includes pairing an impressive grade in the Value category of our Style Scores system with a strong Zacks Rank. The proven Zacks Rank puts an emphas ...

Wall Street analysts expect Fidelity National Information Services (FIS) to post quarterly earnings of $1.20 per share in its upcoming report, which indicates a year-over-year increase of 9.1%. Revenues are expected to be $2.51 billion, up 1.9% from the year-ago quarter.The consensus EPS estimate for the quarter has been revised 0.1% higher over the last 30 days to the current level. This reflects how the analysts covering the stock have collectively reevaluated their initial estimates during this timeframe ...

Core Insights - Fidelity National Information Services (FIS) is anticipated to report a year-over-year increase in earnings driven by higher revenues for the quarter ended March 2025 [1] - The consensus EPS estimate for FIS is $1.20 per share, reflecting a +9.1% change year-over-year, with expected revenues of $2.51 billion, up 1.9% from the previous year [3] - The company has a positive Earnings ESP of +0.88%, indicating a likelihood of beating the consensus EPS estimate, supported by a Zacks Rank of 2 [11] Earnings Estimates and Trends - The consensus EPS estimate for FIS has been revised 0.14% higher in the last 30 days, indicating a bullish sentiment among analysts [4] - The Most Accurate Estimate for FIS is higher than the Zacks Consensus Estimate, suggesting improved earnings prospects [10] - FIS has consistently beaten consensus EPS estimates in the past four quarters, with a surprise of +3.70% in the last reported quarter [12][13] Comparison with Industry Peers - MasterCard is expected to report an EPS of $3.57 for the same quarter, representing a +7.9% year-over-year change, with revenues projected at $7.13 billion, up 12.2% [17] - MasterCard's consensus EPS estimate has been revised 0.1% lower, resulting in a negative Earnings ESP of -0.05%, making it challenging to predict a beat on the consensus EPS estimate [18]

Company Overview - Fidelity National Information Services (FIS) shares increased by 8.7% to close at $74.58, following a notable trading volume that exceeded typical levels, contrasting with a 7.7% loss over the previous four weeks [1][2] Strategic Moves - FIS announced a significant strategic decision to sell its remaining stake in Worldpay to Global Payments for $6.6 billion while acquiring Global Payments' Issuer Solutions business for $13.5 billion, which investors view as a smart realignment to enhance FIS's core banking technology capabilities [2] Earnings Expectations - FIS is projected to report quarterly earnings of $1.20 per share, reflecting a year-over-year increase of 9.1%, with expected revenues of $2.5 billion, up 1.4% from the same quarter last year [3] Earnings Estimate Revisions - The consensus EPS estimate for FIS has been slightly revised higher over the past 30 days, indicating a positive trend that typically correlates with stock price appreciation, suggesting potential for further strength in the stock [4] Industry Context - FIS is part of the Zacks Financial Transaction Services industry, where Global Payments (GPN) experienced a 17.4% decline to $69.46, with a return of -14.3% over the past month, contrasting with FIS's recent performance [4]

Financial Performance - Preliminary estimated revenue for Q1 2025 is $2,532 million, exceeding the outlook range of $2,485 - $2,510 million[8] - Adjusted revenue growth for Q1 2025 is 4%, surpassing the guidance of 2.5%-3.5%[8] - Adjusted EBITDA for Q1 2025 is estimated at $958 million, within the outlook of $940-$960 million[8] - Full-year 2025 revenue guidance is reaffirmed at $10,435 - $10,495 million[9] - Adjusted EPS for Q1 2025 is estimated at $1.21, aligning with the guidance of $1.17 - $1.22[8] - Banking recurring revenue growth for Q1 2025 is 2%, above the guidance of 0.5%-1.5%[8] - Capital Markets recurring revenue growth for Q1 2025 is 9%, exceeding the guidance of 7.0%-8.0%[8] - Adjusted EBITDA margin for Q1 2025 is approximately 37.8%, consistent with the outlook range of 37.8%-38.2%[8] Mergers and Acquisitions - The company plans to acquire the Issuer Solutions business from Global Payments for approximately $13.5 billion[11] - The company will sell Worldpay Holdco, LLC to Global Payments for approximately $24.25 billion[11] Risks - The company faces risks related to failure to innovate, which could impact solutions and customer retention[19] - Operational or natural disasters at major operations centers pose significant risks[19] - Compliance failures with payment network requirements could affect operations[19] - The company is exposed to risks of fraud by bad actors[19] - Additional risks are detailed in the "Risk Factors" section of the Annual Report on Form 10-K for the fiscal year ended December 31, 2024[19]

Core Insights - Zacks Premium offers various tools for investors to enhance their stock market strategies and confidence [1] - The Zacks Style Scores are designed to help investors identify stocks with the highest potential to outperform the market in the short term [2] Zacks Style Scores Overview - The Style Scores categorize stocks into four types: Value Score, Growth Score, Momentum Score, and VGM Score, each focusing on different investment strategies [3][4][5][6] - Value Score emphasizes finding undervalued stocks using financial ratios [3] - Growth Score focuses on a company's financial health and future growth potential [4] - Momentum Score capitalizes on existing price trends to identify favorable investment opportunities [5] - VGM Score combines all three styles to provide a comprehensive assessment of stocks [6] Zacks Rank and Performance - The Zacks Rank is a proprietary model that uses earnings estimate revisions to guide investment decisions [7] - Stocks rated 1 (Strong Buy) have historically achieved an average annual return of +25.41%, significantly outperforming the S&P 500 [8] - A large pool of stocks is available, with over 800 top-rated options, making it essential to use Style Scores to refine selections [9] Stock Highlight: Fidelity National Information Services (FIS) - FIS is rated 2 (Buy) on the Zacks Rank and has a VGM Score of B, indicating strong potential [12] - The company has a forward P/E ratio of 12.21, making it attractive for value investors [12] - Recent upward revisions in earnings estimates suggest positive momentum, with the Zacks Consensus Estimate increasing to $5.74 per share [12] - FIS has demonstrated an average earnings surprise of 9.4%, further supporting its investment appeal [12][13]