One of our favorite insider-buying characters are first time buyers, especially if they have a previous history of pure selling. We call that a change of heart. Fidelity National Information Services, Inc. (FIS) Chief Executive Officer (CEO) Stephanie Ferris is a first time stock buyer after eight previous sales for nearly $19 million.
Ferris had a change of heart and purchased 2,240 shares of FIS at $66.71 on February 21, 2023 for a total investment of $149,430. (1)
The Financial Technology (FinTech) company provides technology solutions for merchants, banks, and capital markets firms worldwide. It operates through Merchant Solutions, Banking Solutions, and Capital Market Solutions segments.
Fintech is a term used to describe the intersection between financial services and technology. It involves the use of digital technology to improve and automate financial services, including banking, insurance, investment, and payment systems. Fintech companies leverage technology to provide new financial products and services, making them more accessible, affordable, and user-friendly.
The growth prospects for Fintech are promising, as technology continues to advance, and consumers increasingly demand more convenient and accessible financial services. Some of the key areas of growth in Fintech include:
- Digital payments
- Digital banking
- Insurtech
- Wealth management
Fintech is expected to continue to grow in the coming years as more people embrace digital financial services, and as the technology behind these services continues to improve.
According to Allied Market research, “The global fintech technologies market size was valued at $110.57 billion in 2020, and is projected to reach $698.48 billion by 2030, growing at a CAGR of 20.3% from 2021 to 2030. (2)
Fidelity National is expected to benefit from the industry trend. Analysts see the company’s earnings increasing to $6.47 per share (EPS) in 2024 from this year’s forecast of $5.85. Although, 2023’s estimate is down from last year’s profit of $6.65. Sales are projected to be essentially flat this year, $14.39 billion from $14.53 billion, and climb to $14.95 billion in 2024. (3)
FIS’ average peer trades at 13.59 times earnings (P/E) and 3.7 times sales (P/S) compared to a P/E of 11.05 and P/S of 3.70 for Ferris’ company. If FIS hits Wall Street’s top and bottom lines next year, then shares could hit $87.93 to $93.22 using the industry’s average P/E and P/S. Shares trade at $63.28 as we type with a one-year price target of $82.50. (4) In addition to potential upside, Fidelity National Information Services currently pays a dividend of $2.08 per share (3.20% yield).
OVERALL: Fidelity National Information Services, Inc. (FIS) could offer investors an attractive combination of growth and income. CEO Stephanie Ferris’ change of heart could indicate that she sees value at its current price at $17.38 above its book value of $45.90 per share.
With a beta of 0.83 versus the S&P 500’s beta of 1, FIS is appropriate for growth and income investors with a moderate risk tolerance.
1 – https://www.secform4.com/insider-trading/1672787.htm
2 – https://www.alliedmarketresearch.com/fintech-technologies-market
3 – https://finance.yahoo.com/quote/FIS/analysis?p=FIS
4 – https://finance.yahoo.com/quote/FIS?p=FIS
