What I'm Watching With Fiserv to See if It Beats the Market

Fiserv (NASDAQ: FISV) is one of the world's leading players in payments technology, but its stock has been absolutely crushed recently after the company missed some important goalposts. The stock is trading down 74% over the past year, but there are signs it might be moving back up from rock bottom.

Let's see what's happening, why the market is down on Fiserv stock, and what I'll be looking for to see if it can bounce back and beat the market.

Image source: Fiserv.

Fiserv has been losing steam and revenue

Fiserv is the financial technology infrastructure behind many more recognizable names. It says it's No. 1 in merchant acquiring, digital banking, issuer processing, and several other crucial payment services, and it's so ubiquitous that it reaches nearly 100% of U.S. households, in addition to 6 million small businesses. And because it's involved in global finance, it also reaches 100 countries worldwide.

Global dominance is an amazing feature that can build confidence, but it's not a reason to assume that a company can always remain at the top. What sometimes happens is that companies become too big to skillfully guide, letting upstart competitors get into the cracks and widen them. Something similar happened to PayPal Holdings, which is still trying to get its act together.

Fiserv stock had been sinking for a while, but it plummeted after the third-quarter earnings release in October, when it missed on the top and bottom lines. Management said that it had identified "competitive and client service gaps," and it was restructuring the company and launching a turnaround plan.

The fourth-quarter report wasn't outstanding, but it demonstrated stability and a reset. Revenue increased 1% year over year, while earnings per share (EPS) were down 8%. This was in line with the expectations set out in October, as was the 2026 guidance. Management is expecting 1% to 3% organic revenue growth and $8.00 to $8.30 in adjusted EPS for 2026, down from $8.64 in 2025.

Investing in Fiserv is a long-term play

The company's action plan involves many steps, including developing relationships with artificial intelligence (AI) and technology partners to become more efficient and relevant and win back market share. It recently announced a deal with ServiceNow and launched a new settlement platform for digital currency called INDX.

Management's update in the fourth-quarter release was that it's on track with its broad initiatives, and early feedback is positive.

The market remains cautious about where this is all going, for good reason. It's too early to tell where it will land, but at the same time, Fiserv's has a huge, global business that would normally be celebrated on the market.

After missing in the third quarter, it beat on EPS in the fourth quarter, while it missed just slightly on revenue. Over the next three quarters, the most important thing investors will want to see is whether Fiserv is meeting guidance and expectations, so that's what I'll be watching.

Jennifer Saibil has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends PayPal and ServiceNow. The Motley Fool recommends the following options: long January 2027 $42.50 calls on PayPal and short March 2026 $65 calls on PayPal. The Motley Fool has a disclosure policy.