Fiserv, Inc. (FISV) recently announced that it has acquired Mobile Commerce Ltd. (M-Com) to strengthen its existing mobile channel capabilities.
Fiserv and M-Com have in partnership since 2008 to develop and deliver Mobile Money from Fiserv to hundreds of financial institutions.
The financial terms of the acquisition were not disclosed. Fiserv and M-Com have a lot of mutual customers in the U.S. and the merger of the two companies will accelerate the development of innovative solutions for these clients.
Management believes that the acquisition of M-Com will enable Fiserv to provide anywhere, anytime access to consumers who want their finances at their fingertips. Additionally, Fiserv will have the ability to integrate M-Com mobile banking and payment technology into current product offerings, as well as leverage that technology for transformative new solutions.
Earlier, Fiserv reported adjusted income from continuing operations of $159 million (excluding items) or $1.06 per share in the fourth quarter of 2010, up 13% year over year. The reported figure missed the Zacks Consensus Estimate by a penny.
Including one-time items, net income from continuing operations came in at $119 million, down 7% year over year.
Revenues came in at $1.08 billion in the fourth quarter of 2010, up 1.5% from the year-ago quarter and almost in line with the Zacks Consensus Estimate of $1.086 billion.
Going forward, Fiserv will focus on creating value for clients and expects to capitalize from investments made in the industry-leading solutions.
For 2011, management projects an adjusted internal revenue growth in the range of 2%- 4%. Fiserv aims at an integrated sale of $155 million and operational effectiveness of $25 million for fiscal 2011.
The company expects additional important wins in 2011, driven by strong interest of clients in Acumen and the strength of its pipelines. For the Bill payment transaction, the company continues to expect double-digit growth. Fiserv projects strong performance in market-leading account processing businesses.
Fiserv assists financial institutions and health plan administrators in managing their information systems, helping them to efficiently deliver services to their customers. The company competes with Fidelity National Information Services Inc. (FIS), Metavante Technologies Inc., Jack Henry and Associates Inc., and Open Solutions Inc.
We are concerned about slow organic growth and expansion of margins, which drive our “Neutral” recommendation, supported by the Zacks # 3 Rank (“Hold”).
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