On Monday, Jefferies, a global investment banking firm, raised its price target for Fiserv (NYSE:FI), a leading global provider of payments and financial services technology solutions. The new price target is set at $160.00, up from the previous $150.00, while the firm continues to hold a neutral stance with a Hold rating on the stock.
The adjustment comes as inflation shows signs of easing and benchmark interest rates are expected to lower. Additionally, there has been a persistent weakness in the Argentine Reciprocal Scales (ARS), which has prompted a revision of revenue projections for Fiserv's Merchant segment within Argentina.
Jefferies' updated bottom-up build for Argentina revenue within Fiserv's Merchant segment takes into account year-to-date reads and consensus economist expectations for the remainder of 2024 and 2025. These projections are based on key macroeconomic drivers that influence Fiserv's dual revenue streams in Argentina.
The firm estimates that Argentina will transition from being a tailwind to a headwind for Fiserv's segment-level reported revenue growth. Specifically, it is projected that Argentina will contribute approximately a 1 percentage point headwind to the segment's revenue growth. This marks a significant shift from the fiscal year 2023, where Argentina was estimated to provide around a 2 percentage point tailwind.
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