What Makes Fiserv (FI) an Investment Bet?

Giverny Capital Asset Management, LLC, an investment management company, recently published its second-quarter 2025 investor letter. A copy of the letter can be downloaded here. During the first half of the year, the market was volatile. The S&P 500 ended June 30 up 6.20%. The portfolio lagged behind the market initially but gained 5.41% over the six months. In the quarter ended June, the portfolio returned 9.11% compared to the S&P 500’s 10.94% return. Additionally, you can review the fund’s top 5 holdings to see its best picks for 2025.

In its second-quarter 2025 investor letter, Giverny Capital Asset Management highlighted stocks such as Fiserv, Inc. (NYSE:FI). Fiserv, Inc. (NYSE:FI) is a payment and fintech services provider. The one-month return of Fiserv, Inc. (NYSE:FI) was -21.45%, and its shares lost 14.04% of their value over the last 52 weeks. On August 5, 2025, Fiserv, Inc. (NYSE:FI) stock closed at $134.28 per share with a market capitalization of $72.994 billion.

Giverny Capital Asset Management stated the following regarding Fiserv, Inc. (NYSE:FI) in its second quarter 2025 investor letter:

“We added to Fiserv during the quarter. In May, Fiserv, Inc. (NYSE:FI) reported slower growth for its Clover payment processing business – Clover is one of several portable terminals that you may have seen restaurants use to process credit card payments. When Clover grew 8% during the first quarter rather than the expected 10%, the stock dropped by 30%. Again, Mr. Market gets hyper sometimes.

Fiserv is one of the most durable growth stories of the past four decades, having grown earnings by at least 10% for 39 straight years. It acts as the primary technology provider to several thousand regional banks. In turn, the banks actively sell Fiserv products like Clover to their customers, allowing them to transmit credit card payments directly to their bank accounts with a full accounting of the day’s receipts. Clover itself is only about 15% of Fiserv’s total business – the company has a menu of other products that its bank partners sell to their own customers – but it has great potential.

Even with temporarily slower growth from Clover, Fiserv should grow earnings about 15% this year, to roughly $10 per share. Wall Street analyst consensus calls for EPS of nearly $12 in 2026. We added to the position at about $169 in May and it closed the quarter a bit higher than that. The current price is just over 14x next year’s earnings estimate in a market that trades for more than 20x forward estimates. There are certainly competing payment terminals that restaurants and small retailers can buy, but none have a massive installed base of regional banks that actively sell and support the product.”

In another article, we covered Fiserv, Inc. (NYSE:FI) and shared the list of best information technology services stocks to invest in. In addition, please check out our hedge fund investor letters Q2 2025 page for more investor letters from hedge funds and other leading investors.

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Disclosure: None. This article is originally published at Insider Monkey.