Fiserv Stock Dropped 49% – Have You Assessed the Risk

Fiserv (FI) stock is down 49.5% in 21 trading days. While history suggests price dips recover, there is risk – specific to balance sheet. Consider the following data:

• Size: Fiserv is a $35 Bil company with $21 Bil in revenue currently trading at $64.00.
• Fundamentals: Last 12 month revenue growth of 6.7% and operating margin of 30.0%.
• Liquidity: Has Debt to Equity ratio of 0.84 and Cash to Assets ratio of 0.01
• Valuation: Fiserv stock is currently trading at P/E multiple of 10.4 and P/EBIT multiple of 5.7
• Has returned (median) 21.3% within a year following sharp dips since 2010. See FI Dip Buy Analysis.

While we like to buy dips if the fundamentals check out – for FI, see Buy or Sell FI Stock – we are wary of falling knives. Specifically, it is worth trying to answer if things get really bad, and FI drops another 20-30% to $45 levels, will we be able to hold on to the stock? What is the worst case scenario? We call it downturn resilience. Turns out, the stock has been more resilient than the S&P 500 index during various economic downturns. We assess this based on both (a) how much the stock fell and, (b) how quickly it recovered.

A single stock can be risky, but there is a huge value to a broader, diversified approach we take with the Trefis High Quality Portfolio. Trefis works with Empirical Asset Management — a Boston area wealth manager — whose asset allocation strategies yielded positive returns during the 2008-09 period when the S&P lost more than 40%. Empirical has incorporated the Trefis HQ Portfolio in this asset allocation framework to provide clients with higher returns while taking on lower levels of risk versus the benchmark index.

Below are the details, but before that, as a quick background: FI provides payment and financial technology services, including point-of-sale merchant acquiring, digital commerce, general ledger management, and debit, credit, and prepaid card processing.

2022 Inflation Shock

• FI stock fell 30.2% from a high of $126.55 on 26 April 2021 to $88.38 on 16 June 2022 vs. a peak-to-trough decline of 25.4% for the S&P 500.
• However, the stock fully recovered to its pre-Crisis peak by 10 July 2023
• Since then, the stock increased to a high of $237.79 on 3 March 2025 , and currently trades at $64.00

 
2020 Covid Pandemic

• FI stock fell 37.8% from a high of $123.89 on 4 February 2020 to $77.00 on 23 March 2020 vs. a peak-to-trough decline of 33.9% for the S&P 500.
• However, the stock fully recovered to its pre-Crisis peak by 11 March 2021

 
2018 Correction

• FI stock fell 16.2% from a high of $82.38 on 28 September 2018 to $69.00 on 24 December 2018 vs. a peak-to-trough decline of 19.8% for the S&P 500.
• However, the stock fully recovered to its pre-Crisis peak by 24 January 2019

 
2008 Global Financial Crisis

• FI stock fell 51.1% from a high of $14.81 on 31 May 2007 to $7.24 on 27 October 2008 vs. a peak-to-trough decline of 56.8% for the S&P 500.
• However, the stock fully recovered to its pre-Crisis peak by 14 December 2010

 
It is a good thing to keep in mind how low FI could go during a downturn. And you should also check how the stock fared when compared with the Trefis High Quality (HQ) Portfolio, with a collection of 30 stocks, has a track record of comfortably outperforming its benchmark that includes all 3 — the S&P 500, S&P mid-cap, and Russell 2000 indices. Why is that? As a group, HQ Portfolio stocks provided better returns with less risk versus the benchmark index; less of a roller-coaster ride, as evident in HQ Portfolio performance metrics.