JACKSONVILLE, Fla. - Fidelity National Information Services (NYSE:FIS), a prominent financial technology provider, announced during its Investor Day that it anticipates a 9-12% annual growth in adjusted earnings per share (EPS) over the medium term.
The company, which recently reported its first-quarter earnings and raised its full-year 2024 financial outlook, is set to detail its growth strategy and capital allocation plans today.
FIS, led by CEO Stephanie Ferris, aims to leverage its robust technology foundation and global presence to deliver sustainable and profitable growth. The company's strategy focuses on three core pillars: leveraging its strong foundation, executing to deliver profitable growth, and allocating capital with discipline.
In terms of financial targets, FIS has set adjusted revenue growth of 4.5-5.5% annually and adjusted EBITDA margin expansion of 40-60 basis points annually for the years 2025 and 2026. Additionally, the company anticipates a total annual return of 11-14%, inclusive of an approximate 2% dividend yield.
Capital allocation is a key priority for FIS, which has increased its share repurchase target by $500 million to $4 billion for the year 2024. The company expects to return about $4.8 billion to shareholders through repurchases and dividends. For the following two years, FIS plans annual share repurchases between $0.8 billion and $1.2 billion, aiming for total returns of $1.7 billion to $2.1 billion to shareholders.
The Investor Day event, which includes a live webcast available on the company's website, will provide an opportunity for the executive team to discuss the strategies in detail.
The forward-looking statements outlined by FIS are subject to various risks and uncertainties, including changes in economic conditions, integration of acquired businesses, international business risks, cybersecurity, and competitive pressures, among others. These factors could potentially affect the company's financial performance.
This news article is based on a press release statement issued by Fidelity National Information Services.
InvestingPro Insights
As Fidelity National Information Services (NYSE:FIS) outlines its growth strategy, the company's financial health and market performance provide crucial context. According to real-time data from InvestingPro, FIS has a substantial market capitalization of $39.56 billion, reflecting its significant presence in the financial technology sector.
Despite a challenging economic environment, the company's revenue has seen a slight uptick, with a growth of 1.05% over the last twelve months as of Q4 2023. This aligns with the company's strategy to deliver sustainable and profitable growth.
Investors may also note the company's P/E ratio, which stands at a high 81.08 based on the last twelve months as of Q4 2023. This could suggest that the market has high expectations for FIS's future earnings.
Moreover, the dividend yield as of March 2024 is 2.04%, which is in line with the company's anticipated 2% dividend yield mentioned during its Investor Day. This is further supported by one of the InvestingPro Tips, highlighting that FIS has raised its dividend for three consecutive years and has maintained dividend payments for 22 consecutive years.
InvestingPro Tips also indicate that FIS is expected to be profitable this year, with net income predicted to grow. This is consistent with the company's medium-term financial targets and capital allocation plans. For investors seeking more in-depth analysis, there are additional InvestingPro Tips available, which can be accessed through the InvestingPro platform. With the use of coupon code PRONEWS24, investors can get an extra 10% off a yearly or biyearly Pro and Pro+ subscription, gaining access to a total of 9 InvestingPro Tips for FIS that could inform investment decisions.
Overall, the data and insights from InvestingPro suggest that Fidelity National Information Services is navigating its growth path with an eye towards rewarding shareholders, while also facing the challenges of a high earnings multiple and the need to balance short-term obligations with liquid assets.
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