There are no safe havens in the stock market. Every stock carries risk. But some less than others. This column features stocks that have shown one or more of the following characteristics: less volatility, better earnings, larger market caps, safe and increasing dividends. In these times of turmoil, our goal is to show readers better opportunities for investing with fewer risks.

August 25, 2009 - Fiserv, Inc. (FISV-NASDAQ) provides information management and electronic commerce systems and services, including transaction processing, electronic bill payment and presentment, business process outsourcing, document distribution services, and software and systems solutions primarily in the United States.

The Payments and Industry Products segment provides products and services that address a range of technology needs, including Internet banking, electronic bill payment, electronic funds transfer and debit processing, fraud and risk management capabilities, card and print personalization services, and check imaging and investment account processing services for separately managed accounts for the financial services industry.

The company serves about 18,000 banks and thrifts, broker-dealers, credit unions, savings institutions, retailers and merchants, leasing companies, lenders, government agencies, and publicly and privately owned companies. It also has operations in Argentina, Australia, Canada, China, Colombia, Costa Rica, France, India, Indonesia, Luxembourg, Malaysia, Mexico, the Netherlands, the Philippines, Puerto Rico, Poland, Singapore, and the United Kingdom. Fiserv, Inc. was founded in1984 and is headquartered in Brookfield, Wisconsin.

Fiserv serves the financial sector, one of the hardest hit in these economically tough times. Of course, many of the financials are the reason we're experiencing the economic mess, but that's another story. Fiserv is all about making financial transactions faster and more efficient. And even with the slowdown, it's making good profits.

For the last 5 years, earnings have grown by 17.5% a year, on average while revenues gained by 15% annually, on average. This year, the consensus from 18 analysts is for earnings to be $3.67, up from $3.29 last year. For 2010, the consensus is for $4.10. The next quarterly announcement will be on October 27 with a target of 92 cents a share, up from 81 cents in the third quarter last year. For the fourth quarter, the estimate is for 96 cents a share, well above the 85 cents of last year's fourth period.

Revenues are expected to slow this year. Analysts see $4.2 billion, down 11.3% from the $4.74 billion of last year. To put that in perspective, most large-cap companies saw revenue declines closer to 17%. Next year, look for sales of $4.37 billion, up about 4%.

When the recession gets in the rear view mirror, expect even better numbers from Fiserv as banks go more and more digital to serve their Internet savvy, mobile customers. Bill payment via the computer is addictive. Once most people try it, they don't go back to writing checks. Banks that don't offer that now will definitely add that feature once they can afford to expand their services. Fiserv will be there to help.

More numbers: Trailing P/E is 20.5 but the Forward P/E is 12. Price to sales is 1.8 while Price to book is 2.68. For the last 12 months, the operating margin was 22.17% and Profit margins were 9.08%. Return on equity was 12.7%. Total cash at the end of last quarter was $309 million or $2.00 a share. Total debt is $3.88 billion which is 57% of capital. Current ratio is 1.16. There are 154.38 million shares outstanding with a float of 150.54 million. Insiders own 2.09% of the stock while institutions have 85%. There is no dividend. The stock has a Value Line Financial Strength rating of B++.

Conservative investors who feel the economy is about to improve should find this stock of interest. It serves one of the engines of economic growth, the financial sector, a sector that has been badly damaged over the last 18 months. With a decent recovery, banks and thrifts as well as brokers should see increased activity, requiring more efficiencies. And they will most likely look to Fiserv to supply them.

Company Web site: www.fiserv.com

- Ted Allrich