Fidelity National Information Services Beats on EPS but GAAP Results Lag

Seth Jayson, The Motley Fool
Updated

Fidelity National Information Services (NYS: FIS) reported earnings on Feb. 24. Here are the numbers you need to know.

The 10-second takeaway
For the quarter ended Dec. 31 (Q4), Fidelity National Information Services met expectations on revenues and beat slightly on earnings per share.

Compared to the prior-year quarter, revenue increased and GAAP earnings per share shrank significantly.

Gross margins improved, operating margins increased, and net margins dropped.

Revenue details
Fidelity National Information Services booked revenue of $1.49 billion. The 14 analysts polled by S&P Capital IQ expected revenue of $1.49 billion on the same basis. GAAP reported sales were 7.0% higher than the prior-year quarter's $1.40 billion.

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Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.

EPS details
Non-GAAP EPS came in at $0.66. The 17 earnings estimates compiled by S&P Capital IQ forecast $0.65 per share on the same basis. GAAP EPS of $0.39 for Q4 were 33% lower than the prior-year quarter's $0.58 per share.

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Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.

Margin details
For the quarter, gross margin was 32.4%, 90 basis points better than the prior-year quarter. Operating margin was 21.9%, 450 basis points better than the prior-year quarter. Net margin was 7.8%, 490 basis points worse than the prior-year quarter.

Looking ahead
Next quarter's average estimate for revenue is $1.45 billion. On the bottom line, the average EPS estimate is $0.51.

Next year's average estimate for revenue is $6.02 billion. The average EPS estimate is $2.52.

Investor sentiment
The stock has a three-star rating (out of five) at Motley Fool CAPS, with 121 members out of 138 rating the stock outperform, and 17 members rating it underperform. Among 40 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 38 give Fidelity National Information Services a green thumbs-up, and two give it a red thumbs-down.

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At the time thisarticle was published Seth Jayson had no position in any company mentioned here at the time of publication. You can view his stock holdings here. He is co-advisor ofMotley Fool Hidden Gems, which provides new small-cap ideas every month, backed by a real-money portfolio. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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