Citi downgrades FIS on disappointing results, spin-off plan

Citi analyst Ashwin Shirvaikar downgraded FIS to Neutral from Buy with a price target of $70, down from $85. The company delivered on Q4 estimates but its forward outlook, strategic direction and level of detail disappointed investors, the analyst tells investors in a research note. The firm believes spinning off the Merchant business is a "potential lost opportunity" and that a reorganization which consolidated the company’s Payments assets might have been a better approach. FIS’s lack of detail on its debt levels, acquisition capability and commercial agreement make it difficult to perform a sum-of-the-parts analysis, contends Citi.