FISERV INC (FISV) DCF Valuation & Fundamental Primer
FISERV INC (FISV) currently trades at $66.99 with an enterprise value of $88.28B. Our proprietary institutional model rates FISERV INC at 63/100 (Grade: B · Mixed Fundamental Profile). The current market price prices in an implied 5-year revenue CAGR of -0.8% vs. historical growth of 8.3% (Substantial Margin of Safety).
Institutional fundamental teardown of Fiserv, Inc. (FISV) covering SEC 10-K/10-Q cash flow conversion, SBC dilution friction, and Reverse-DCF valuation hurdles.
FISERV INC (FISV) 3-Scenario DCF Valuation Range
Stress-test FISV's 5-year growth, target FCF margin, WACC, terminal methodology, and SBC/dilution friction in real time.
Split between 5-Year Explicit Cash Flows and Discounted Terminal Value
2D Institutional Valuation Sensitivity Heatmap
Implied share price & upside/downside spread across 25 valuation states (Current Price: $66.99).
| WACC \ Terminal | 1.5% | 2.0% | 2.5% | 3.0% | 3.5% |
|---|---|---|---|---|---|
| 8.5% | $136.12 +103% | $147.10 +120% | $159.91 +139% | $175.05 +161% | $193.22 +188% |
| 9.3% | $118.17 +76% | $126.82 +89% | $136.75 +104% | $148.27 +121% | $161.80 +142% |
| 10.0% | $103.40 +54% | $110.36 +65% | $118.24 +77% | $127.25 +90% | $137.64 +105% |
| 10.8% | $91.04 +36% | $96.73 +44% | $103.11 +54% | $110.30 +65% | $118.49 +77% |
| 11.5% | $80.55 +20% | $85.26 +27% | $90.50 +35% | $96.36 +44% | $102.95 +54% |
Institutional Software Quality Scorecard (63/100 · Grade B)
Viable recurring software business but carries notable dilution, lower margins, or higher leverage.
Solid cash generation with minor working capital absorption
Minimal dilution friction; management compensation aligned with shareholders
Sub-par gross margins; higher cost of delivery or hardware/services mix
Moderate leverage or cash burn; monitor liquidity runway
Core Investment Strengths & Moats
- Low dilution friction: SBC is only 1.8% of revenue
Key Operational & Dilution Risks
- Lower software gross margins (60.8%), indicating higher hosting or service delivery drag
Reverse-DCF Solver: What Growth is Priced Into FISV?
The current share price only requires -0.8% 5-year CAGR (0.2% dilution-adjusted), well below historical growth of 8.3%. If the company maintains baseline execution, there is asymmetric upside.
Headline Reverse-DCF ignores Stock-Based Compensation (1.8% of revenue) and annual share dilution (0.2%/yr). Accounting for both requires 0.2% 5-year revenue CAGR to justify $66.99/sh on a true per-share economic cash flow basis.
FISERV INC (FISV) 5-Year Fundamental Forecast
| Statement Line Item | TTM Audited Base | TTM | Y1 | Y2 | Y3 | Y4 | Y5 |
|---|---|---|---|---|---|---|---|
| Revenue | $20.46B | $20.46B | $22.16B | $24.01B | $26.01B | $28.17B | $30.52B |
| Gross Profit | $12.44B | $12.44B | $13.48B | $14.60B | $15.82B | $17.14B | $18.56B |
| Operating Income (EBIT) | $5.88B | $5.88B | $6.37B | $6.90B | $7.47B | $8.10B | $8.77B |
| Stock-Based Compensation (SBC) | $367.0M | $366.2M | $396.7M | $429.7M | $465.5M | $504.3M | $546.3M |
| Unlevered Free Cash Flow (FCF) | $5.06B | $5.06B | $5.48B | $5.94B | $6.44B | $6.97B | $7.55B |
| SBC-Adjusted True Cash Flow | $4.70B | $4.70B | $5.09B | $5.51B | $5.97B | $6.47B | $7.01B |
Software & Cloud Services Peer Comparables & Rule of 40 Regression
Rule of 40 vs. EV / Revenue Multiple Regression
OLS Fit: EV/Rev = -20.1 + 0.63 × (Rule of 40) · R² = 79%Stocks below the gold regression line trade at a discount relative to their Rule of 40 compounding efficiency.
| Company | Ticker | Market Cap | TTM Revenue | Gross Margin | FCF Margin | Rule of 40 | SBC % Rev | EV / Rev |
|---|---|---|---|---|---|---|---|---|
| FISERV INC | FISV | $36.42B | $20.46B | 60.8% | 24.8% | 33.1% | 1.8% | 2.9× |
| ServiceNow | NOW | $152.61B | $10.98B | 79.2% | 31.1% | 54.2% | 15.9% | 13.9× |
| Workday, Inc. | WDAY | $50.35B | $8.00B | 75.0% | 27.4% | 43.9% | 19.0% | 6.4× |
| Salesforce | CRM | $217.10B | $37.90B | 77.2% | 32.8% | 42.8% | 8.4% | 5.8× |
| Datadog | DDOG | $46.05B | $2.68B | 80.8% | 31.1% | 57.7% | 21.3% | 17.4× |
| Snowflake Inc. | SNOW | $71.79B | $3.63B | 66.5% | 25.2% | 57.7% | 40.8% | 20.0× |
| Hubspot | HUBS | $19.89B | $2.63B | 85.0% | 21.3% | 52.7% | 19.2% | 7.7× |
| Peer Cohort Median Benchmark (N=6) | 78.2% | 29.2% | 53.5% | 19.1% | 10.8× | |||
EV / Revenue Multiple Compression Stress Test
| Multiple Scenario | EV / Revenue | Implied Enterprise Value | Implied Equity Value | Implied Share Price | Delta vs Current |
|---|---|---|---|---|---|
| Current Multiple | 2.9× | $60.14B | $36.42B | $66.99 | 0.0% |
| -20% Multiple Compression | 2.4× | $48.11B | $24.39B | $44.86 | -20.0% |
| -35% Multiple Compression | 1.9× | $39.09B | $15.37B | $28.27 | -35.0% |
| Software Baseline Floor (5.0× EV/Rev) | 5.0× | $102.28B | $78.56B | $144.52 | +70.1% |
Frequently Asked Questions: FISERV INC (FISV) Valuation
What is FISERV INC (FISV)'s intrinsic DCF valuation and implied share price?
Based on audited SEC 10-K/10-Q filings and a 5-year 3-statement discounted cash flow (DCF) model, FISERV INC (FISV) has a Base Case implied value of $118.77 per share (with a Bear Case of $44.59 and a Bull Case of $205.69), compared to its current price of $66.99. The model discounts projected free cash flows at a 10.0% WACC and a 2.5% terminal growth rate.
What is FISERV INC (FISV)'s Rule of 40 score and Free Cash Flow margin?
FISERV INC achieves a Rule of 40 score of 33.1%, combining a 8.3% revenue growth run-rate with a 24.7% TTM free cash flow margin on $20.46B in trailing twelve-month revenue. In the Software & Cloud Services peer cohort, the median Rule of 40 benchmark is 53.5%.
What revenue growth rate is priced into FISV stock according to Reverse-DCF analysis?
At $66.99 per share (Enterprise Value of $60.14B), our Reverse-DCF solver indicates the market is pricing in a 5-year implied revenue CAGR of -0.8%, compared to FISERV INC's historical CAGR of 8.3%. Overall market expectations are rated as "Substantial Margin of Safety".
How does FISERV INC compare to Software & Cloud Services software peers?
FISERV INC (FISV) earns an institutional Software Quality Score of 63/100 (Grade B — Mixed Fundamental Profile). Across its Software & Cloud Services peer group (NOW, WDAY, CRM, DDOG, SNOW), the cohort trades at a median EV/TTM Revenue multiple of 10.8× and a median gross margin of 78.2%.
How does Stock-Based Compensation (SBC) impact FISERV INC (FISV)'s valuation?
FISERV INC recorded $367.0M in TTM stock-based compensation (1.8% of revenue). When treating SBC as a cash-equivalent compensation expense, FISERV INC's SBC-adjusted free cash flow yield is 12.9%, scoring 25/25 on our Shareholder Dilution Friction pillar.