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Investing.com — Michael Burry of The Big Short fame has a new contrarian bet in payments. Not his first, but when Burry backs a beaten-down stock, markets tend to listen.
In a November 2 Substack post, he argued that Fiserv (NASDAQ:FISV), a major U.S. payment processor, could fetch $100 to $120 a share in a private-equity buyout. This is more than double where the stock traded in late October. His yardstick is reported buyout interest in Global Payments (NYSE:GPN), and he still calls PayPal (NASDAQ:PYPL) a "fat pitch" in the $50s.
The catch is the payoff needs a bidder, or a turnaround that has already stumbled once this year. ProPicks AI's data-driven Best of Buffett strategy takes a different route, through the networks that collect a fee on everyday spending. Since joining the strategy, a global payment network is up more than 1,000%, a peer payment rail nearly 960% and a premier consumer lending and transaction network 10.1%.
See the AI-picked stocks behind those returns: Explore the Best of Buffett strategy on InvestingPro
Payments Plumbing in a Reset Year
Fiserv processes about a third of U.S. merchant payment volume, holds the top share in U.S. issuer processing and serves 80% of U.S. banks and credit unions with at least one product. Roughly 84% of adjusted revenue is recurring, and Clover, its point-of-sale platform, grew payment volume 9% in the second quarter (11% excluding gateway conversion).
The year has still been rough. In August, second-quarter adjusted EPS of $1.84 missed the $1.91 consensus, and management cut its 2026 outlook weeks after reaffirming it on June 15. Organic revenue is now expected to range from down 1% to flat, with adjusted EPS of $7.20 to $7.40.
Third-quarter results on November 3 held that line. Organic revenue was flat, adjusted EPS came in at $1.75 and the full-year outlook was reaffirmed. Fiserv also doubled its Project Elevate cost-savings target to $1 billion and plans $500 million of buybacks in the fourth quarter. A $6.45 billion non-cash goodwill impairment, tied to the slide in the share price, pushed the quarter to a GAAP loss.
A new CEO took over in mid-2026, and activist investor Jana Partners has pushed for deeper cost cuts. The shares have lost 76.2% over two years. Burry blames overly ambitious targets from previous management and disclosures clouded by Argentine hyperinflation, and he cites insider buying at current prices.
A Cheap Multiple on a Heavy Balance Sheet
InvestingPro data put Fiserv at 9.2 times trailing earnings and 6.6 times 2026 consensus EPS of $7.24, with a 15.2% free cash flow yield. InvestingPro's Fair Value, which aggregates multiple discounted cash flow approaches, is $80.61, roughly two-thirds above the $47.90 price. Even that falls short of Burry's range.
Consensus analyst projections compiled on InvestingPro are lower still: an average price target of $57.55 against a high of $106, roughly where Burry's range begins. They also show 27 downward EPS revisions over the prior 90 days and none upward.
Bank of America rates Fiserv Underperform with a $48 target. It downgraded PayPal, Burry's "fat pitch," to the same rating, while rating Global Payments, his buyout yardstick, a Buy.
Operating cash flow has topped $4.6 billion in every year since 2022, and some of it is going to the balance sheet. Long-term debt fell to $25.8 billion at the end of September from $27.8 billion at the end of 2025, and management targets gross debt of about 3 times adjusted EBITDA by year-end.
At Burry's range, the equity alone would be worth roughly $53 billion to $64 billion, or 14 to 17 times 2026 consensus EPS, before counting the debt an acquirer would take on. The Fiserv Pro Research Report sets that valuation math beside the debt-paydown runway and Clover's volume growth.
Check the valuation math, debt paydown and Clover volume growth: Access the Fiserv Pro Research Report on InvestingPro
The Cost of Waiting for a Bidder
The data show a cheap stock and no confirmed buyer. Fiserv has entrenched processing infrastructure and a multiple that already discounts bad news, and a confirmed bid would reprice the shares.
Until then, the turnaround rests on a management team that cut guidance once this year, and more than $25 billion of long-term debt leaves little room for error if the recovery slips.
Backing one beaten-down stock is a concentrated bet on a single outcome that partly depends on someone else. A monthly, data-driven screen rotates its holdings at each rebalance.
The payment networks and lenders behind that strategy's returns earn their cash flow as spending happens, without waiting for a bidder.
Get the new picks in November's rebalance: Review the latest AI-picked strategies on InvestingPro
Disclosure: The author holds no position in the stocks mentioned. Data and financial metrics as of November 4, 2026.
Original Article
Michael Burry sees buyout value in Fiserv. Do the numbers agree?
