Fiserv Shares Plunge 47% After Shock Earnings Miss Baffles Wall Street

Benzinga

Fiserv shares plunged 47% after a severe Q3 earnings miss and reduced full-year outlook shocked analysts. The company’s margins fell sharply as revenue in its financial-solutions unit dropped 3%. Analysts called the results “impossible to sugarcoat,” with mounting concerns over the competitiveness of its Clover business.

Transcript

00:00It's Benzinga, bringing Wall Street to Main Street.

00:02Five-star shares plunged a record 47% after the company reported a major third-quarter earnings miss

00:07and cut its full-year outlook, according to Bloomberg.

00:10Sureful shocked analysts, while shares of other payments-related stocks also fell.

00:14William Blair's Andrew Jeffery called Five-star's results impossible to sugarcoat

00:18and downgraded the stock to market and perform.

00:21The company's unexpected earnings miss shocked Wall Street,

00:23where nearly 80% of analysts had buy ratings,

00:26raising tough questions for both executives and analysts.

00:28Rothschild and company Redbird's Dominic Ball,

00:31the only analyst with a sell rating for the report,

00:34said Five-star's business units fell off a cliff.

00:36He previously argued that the company's Clover unit was uncompetitive against rivals

00:40due to weaker pricing and distribution.

00:43Five-star reported a 3% revenue decline in its Financial Solutions division

00:46and a drop in margins to 42.5%, down five points from a year earlier.

00:51For all things money, visit Benzinga.com.

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