Raymond James has lowered its 12-month price target for Fidelity National Information Services (FIS) to $60 from $82, while maintaining an Outperform rating on the stock. The firm pointed to a mixed fourth-quarter result in which revenue modestly exceeded expectations but adjusted earnings metrics fell short.
In the quarter, FIS reported revenue approximately 2% above estimates. Despite the top-line beat, adjusted earnings per share missed consensus by $0.01. Raymond James attributed that EPS shortfall primarily to a weaker-than-expected adjusted EBITDA margin, which came in roughly 140 basis points below the broker's forecast. The firm noted the margin pressure was largely linked to higher demand for output solutions, and management said results would have aligned with estimates if not for that specific factor.
The stock has responded negatively to the report. Shares were trading at $48.12, close to a 52-week low of $46.16, and have declined about 33% over the past six months.
Management also confirmed the completion of the Worldpay and Issuer transactions and issued initial fiscal 2026 guidance for the combined company. On a pro-forma basis, the guidance was modestly ahead of Raymond James' model on revenue by about 3% and on adjusted EBITDA by about 1%. However, adjusted EPS guidance was roughly 2% below Raymond James' projections.
Breaking out the guidance, banking revenue is expected to grow between 5.0% and 5.5% on a pro-forma basis, roughly 100 basis points above Raymond James' estimate. Capital markets revenue guidance was provided at 6% at the midpoint, which Raymond James considered to be in line with expectations.
Company management committed to delivering approximately $2.1 billion of free cash flow in 2026 and more than $3.0 billion in 2027. They also reiterated a plan to reduce leverage to roughly 2.8 times within 18 months. Raymond James' valuation notes indicate the shares trade at about 7 times the firm's 2027 estimated EBITDA and EPS, and around 8 times market capitalization to free cash flow.
FIS continues to pay a dividend, offering a yield of 3.71% and maintaining a 24-year streak of dividend payments.
Additional analyst activity followed the company results and guidance. RBC Capital lowered its price target on the stock to $69 from $86, while retaining an Outperform rating. RBC's analyst Daniel Perlin said the change reflected the company’s quarterly results and the newly issued fiscal 2026 guidance.
Taken together, the mixed quarterly results, modestly divergent guidance versus broker models, and the company's forward-looking cash flow and leverage targets give investors fresh data points on FIS' financial trajectory. Management emphasized that specific demand for output solutions pressured margins in the quarter, and that excluding that element, results would have been more in line with expectations.
Investors evaluating FIS will weigh near-term margin dynamics and the company's ability to meet its free cash flow and leverage reduction commitments against recent stock weakness and updated analyst targets.