Price to FCFE (P/FCFE)
Free Cash Flow to Equity (FCFE)
Fiserv Inc., FCFE calculation
US$ in millions
Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).
Net cash provided by operating activities exhibited a consistent upward trajectory between 2017 and 2020, rising from 1,483 million to 4,147 million, before experiencing a slight stabilization at 4,034 million in 2021. This indicates a substantial and sustained increase in the capacity to generate liquidity from core business operations over the analyzed period.
- Operating Cash Flow Growth
- A strong growth pattern is observed in operating cash flows, which increased by approximately 171% from 2017 to 2021. The most aggressive expansion occurred between 2018 and 2020, suggesting improved operational efficiency or significant scaling of revenue-generating activities.
- Free Cash Flow to Equity (FCFE) Volatility
- FCFE demonstrated extreme volatility compared to the steady growth of operating cash. A significant anomaly occurred in 2019, where FCFE spiked to 16,814 million, far exceeding the operating cash flow of 2,795 million for that year. This divergence suggests a massive influx of cash from financing activities, such as substantial new debt issuance or the divestiture of assets. This peak was followed by a sharp correction to 1,204 million in 2020, before recovering to 3,169 million in 2021.
- Relationship Between Operational and Equity Cash Flows
- The lack of correlation between the steady rise in operating cash and the erratic movement of FCFE indicates that the cash available to shareholders was driven primarily by capital expenditure decisions and financing maneuvers rather than operational performance alone. The sharp decline in FCFE in 2020, despite record-high operating cash flows, suggests a period of intense capital investment or significant debt repayment during that fiscal year.
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Price to FCFE Ratio, Current
Fiserv Inc., current P/FCFE calculation, comparison to benchmarks
| No. shares of common stock outstanding | 646,394,065 |
| Selected Financial Data (US$) | |
| Free cash flow to equity (FCFE) (in millions) | 3,169) |
| FCFE per share | 4.90 |
| Current share price (P) | 104.74 |
| Valuation Ratio | |
| P/FCFE | 21.36 |
| Benchmarks | |
| P/FCFE, Competitors1 | |
| Accenture PLC | 8.88 |
| Adobe Inc. | 9.92 |
| AppLovin Corp. | 22.21 |
| Cadence Design Systems Inc. | 54.92 |
| Datadog Inc. | 347.07 |
| International Business Machines Corp. | 16.59 |
| Intuit Inc. | 8.90 |
| Microsoft Corp. | 60.87 |
| Oracle Corp. | 23.08 |
| Palantir Technologies Inc. | 225.08 |
| Palo Alto Networks Inc. | 78.55 |
| Salesforce Inc. | 10.32 |
| ServiceNow Inc. | 36.26 |
| Synopsys Inc. | 5.56 |
| Workday Inc. | 18.22 |
| P/FCFE, Sector | |
| Software & Services | 59.33 |
| P/FCFE, Industry | |
| Information Technology | 76.55 |
Based on: 10-K (reporting date: 2021-12-31).
1 Click competitor name to see calculations.
If the company P/FCFE is lower then the P/FCFE of benchmark then company is relatively undervalued.
Otherwise, if the company P/FCFE is higher then the P/FCFE of benchmark then company is relatively overvalued.
Price to FCFE Ratio, Historical
Fiserv Inc., historical P/FCFE calculation, comparison to benchmarks
| Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | ||
|---|---|---|---|---|---|---|
| No. shares of common stock outstanding1 | 652,196,905 | 669,459,877 | 679,098,783 | 391,586,971 | 413,215,728 | |
| Selected Financial Data (US$) | ||||||
| Free cash flow to equity (FCFE) (in millions)2 | 3,169) | 1,204) | 16,814) | 2,226) | 1,521) | |
| FCFE per share3 | 4.86 | 1.80 | 24.76 | 5.68 | 3.68 | |
| Share price1, 4 | 95.56 | 115.37 | 108.54 | 84.75 | 71.06 | |
| Valuation Ratio | ||||||
| P/FCFE5 | 19.67 | 64.15 | 4.38 | 14.91 | 19.31 | |
| Benchmarks | ||||||
| P/FCFE, Competitors6 | ||||||
| Accenture PLC | 25.76 | — | — | — | — | |
| Adobe Inc. | 34.26 | 41.36 | — | — | — | |
| AppLovin Corp. | 22.51 | — | — | — | — | |
| Cadence Design Systems Inc. | 36.31 | — | — | — | — | |
| Datadog Inc. | 202.25 | — | — | — | — | |
| International Business Machines Corp. | 48.45 | — | — | — | — | |
| Intuit Inc. | 86.74 | — | — | — | — | |
| Microsoft Corp. | 42.54 | — | — | — | — | |
| Oracle Corp. | 8.36 | — | — | — | — | |
| Palantir Technologies Inc. | 198.12 | — | — | — | — | |
| Palo Alto Networks Inc. | 32.91 | — | — | — | — | |
| Salesforce Inc. | 49.52 | — | — | — | — | |
| ServiceNow Inc. | 64.54 | — | — | — | — | |
| Synopsys Inc. | 40.55 | 45.07 | — | — | — | |
| Workday Inc. | 40.57 | — | — | — | — | |
| P/FCFE, Sector | ||||||
| Software & Services | 34.11 | — | — | — | — | |
| P/FCFE, Industry | ||||||
| Information Technology | 27.39 | — | — | — | — | |
Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).
1 Data adjusted for splits and stock dividends.
3 2021 Calculation
FCFE per share = FCFE ÷ No. shares of common stock outstanding
= 3,169,000,000 ÷ 652,196,905 = 4.86
4 Closing price as at the filing date of Fiserv Inc. Annual Report.
5 2021 Calculation
P/FCFE = Share price ÷ FCFE per share
= 95.56 ÷ 4.86 = 19.67
6 Click competitor name to see calculations.
The analysis of the Price to Free Cash Flow to Equity (P/FCFE) ratio reveals a period of extreme volatility between 2017 and 2021. While the share price followed a relatively steady trajectory of growth until 2020, the P/FCFE ratio was primarily influenced by substantial swings in the underlying FCFE per share, leading to inconsistent valuation multiples.
- Share Price Performance
- A consistent upward trend in share price was observed from 2017 through 2020, rising from 71.06 US$ to a peak of 115.37 US$. A subsequent decline occurred in 2021, with the price adjusting to 95.56 US$.
- FCFE per Share Volatility
- Free Cash Flow to Equity per share exhibited non-linear behavior. A significant spike occurred in 2019, reaching 24.76 US$, which was immediately followed by a sharp contraction to 1.80 US$ in 2020. By 2021, the figure recovered to 4.86 US$, returning to levels comparable to the 2018 period.
- P/FCFE Ratio Dynamics
- The valuation multiple fluctuated inversely to the FCFE per share. The ratio reached its lowest point of 4.38 in 2019 due to the surge in cash flow, and its highest point of 64.15 in 2020 following the collapse in FCFE per share. By the end of 2021, the ratio stabilized at 19.67, effectively reverting to the valuation levels observed at the start of the period in 2017.
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