ACIW · ACI Worldwide
Conviction · Medium · more likely to lead the S&P 500 over the next three months, by a modest margin
Wrong if: a daily close below $54.00
Note written ·
Price against the kill line
12.6% clear of its kill line on the 13 November 2026 close.
How to read this
The red mark is the price level of the published kill line: a close through it (a weekly close, on a weekly line) would prove the research note wrong on price. The dot is where the stock closed on 13 November 2026; a dot left of the mark has closed through its line.
The scale is stretched near the line, so close calls are easy to see. More than 8% from the line, the stock reads well clear, with a hollow dot to show the figure is off the drawn scale.
The kill line is the research note's own test. The portfolio sells on business facts, not on a price. How the portfolio decides
Three months against the kill line
Daily closes, to . Red: the kill line, a daily close below $54.00, on record since 10 November 2026. The shares are up 16.6% since the close; the S&P 500 is down 2.1% over the same sessions. Figures in the note can cover a different window.
Kill line
A daily close below $54.00, the former July breakout level, which would return the shares to their range before the third-quarter report. Fourth-quarter revenue below the $612 million low end of the guide, or a cut to full-year revenue guidance, would also break the case.
Research onlyNot in the portfolio.
Key figures from the filings · Technology
Quarter to 30 September 2026, filed 5 November 2026; valuation at the 13 November 2026 close
- Revenue, latest quarter ($M)
- 427
- Revenue, change on a year (%)
- −11.5
- Gross margin (%)
- 45.8
- Operating margin (%)
- 12.3
- Free cash flow, four quarters ($M)
- 358
- Net cash, cash less debt ($M)
- −598
- Price to earnings (×)
- 36.5
- Enterprise value to sales (×)
- 3.8
All filed numbers
What ACI Worldwide reports to the SEC in its quarterly and annual filings. Each group states its period and filing date once; a figure dated otherwise says so. Built from the filings known on .
| Quarter to | Revenue ($M) | On a year (%) | Gross margin (%) | Operating margin (%) |
|---|---|---|---|---|
| first filed | 427 | −11.5 | 45.8 | 12.3 |
| first filed | 430 | +7.3 | 42.2 | 10.4 |
| first filed | 426 | +7.9 | 46.3 | 13.5 |
| first filed | 482 | +6.3 | 53.0 | 22.6 |
| first filed | 482 | +6.8 | 53.7 | 26.5 |
| first filed | 401 | +7.4 | 41.5 | 8.7 |
| Pre-tax income ($M) | 42.2 |
| Net income ($M) four quarters: 167 | 32.5 |
| Diluted shares, change on a year (%) against the quarter to 30 September 2025 | −2.5 |
| Operating cash flow ($M) | 376 |
| Capital spending ($M) | 17.8 |
| Free cash flow ($M) | 358 |
| Cash and short-term investments ($M) | 219 |
| Debt ($M) long-term debt | 817 |
| Net cash, cash less debt ($M) | −598 |
| Deferred revenue ($M) +16.5% on a year | 92.8 |
| Backlog, orders not yet delivered ($M) −6.8% on a year | 702 |
| Receivables ($M) | 428 |
| Inventory ($M) | Not reported |
| Shareholders' equity ($M) | 1,493 |
| Market value ($M) | 6,091 |
| Enterprise value, market value plus net debt ($M) | 6,689 |
| Enterprise value to sales (×) | 3.8 |
| Enterprise value to operating income (×) | 25.4 |
| Price to earnings (×) | 36.5 |
| Price to book value (×) | 4.1 |
| Free-cash-flow yield (%) | 5.9 |
Short interest (FINRA, settled 15 October 2026, published 26 October 2026): 6.3% of shares outstanding sold short, 9.7 days of average trading to cover, −1.5% since the previous report.
| Window | Bought | Sold |
|---|---|---|
| 90 daysfrom | $0 | $0 |
| 12 monthsfrom | $224K | $0 |
The thesis
ACI Worldwide's shares are more likely to beat the S&P 500 over the next three months, because third-quarter 2026 revenue reached the top of guidance and full-year profit guidance rose. The fourth quarter, when most Payment Software license renewals fall, settles it. ACI guides that quarter to $612 million–$642 million of revenue, to be reported around February 2027.
The shares closed at $61.26 on 12 November 2026, up 14.6% over three months. That is 2.9% below the 52-week intraday high of $63.10 set on 5 November 2026, the day of the report. The consensus target MarketBeat reported on 6 November 2026 was $61.00, so the market has already priced in much of the recovery. Needham reiterated its Hold rating on 6 November 2026 because the business still depends on lumpy renewals (Investing.com).
Bullish and bearish views on ACI Worldwide, Inc.
The bull case on ACI Worldwide, Inc. (ACIW), in brief: revenue hit the top of guidance. The bear case: Payment Software shrank sharply.
Bull case
- Revenue hit the top of guidance. ACI reported third-quarter 2026 revenue of $427 million against its $417 million–$427 million guide (ACI release, 5 November 2026). Investing.com put the Wall Street estimate at $421.76 million.
- Bookings rebounded. Net new annual recurring revenue was $24 million in the third quarter, up 86% (ACI release, 5 November 2026). The trailing-twelve-month figure through 30 September 2026 was $79 million, down 3%, an improvement on the 15% decline a quarter earlier.
- Profit guidance went up. ACI raised full-year adjusted EBITDA (earnings before interest, taxes, depreciation and amortization) guidance to $550 million–$565 million from $545 million–$560 million on 5 November 2026. Full-year revenue guidance stayed at $1.895 billion–$1.925 billion.
- Biller is growing. Biller revenue was $210 million in the third quarter, up 6%, with segment adjusted EBITDA of $34 million, up 4% (ACI release, 5 November 2026). Investing.com reported on 6 November 2026 that the Biller sales team reached its full-year target before the quarter ended.
- The new platform has a first live customer. Investing.com reported on 6 November 2026 that ACI Connetic, the company's cloud payments platform, had its first customer go-live and two signings in the third quarter.
- Buybacks shrink the share count. ACI repurchased about 935,000 shares for about $50 million in the third quarter, with $299 million of authorization remaining (ACI release, 5 November 2026).
Bear case
- Payment Software shrank sharply. Segment revenue was $216 million in the third quarter, down 24%, and segment adjusted EBITDA was $107 million, down 41% (ACI release, 5 November 2026). ACI attributes the drop to renewals concentrated in the fourth quarter.
- Recurring software revenue slipped. Payment Software recurring revenue was $99 million in the third quarter, down 1%, after 3% growth in the second quarter (ACI releases, 6 August 2026 and 5 November 2026).
- The fourth quarter carries the year. Guidance of $612 million–$642 million compares with $427 million in the third quarter. The consensus estimate cited in news headlines on 5 November 2026 was $628.4 million, close to the midpoint of the guide.
- Group profit fell from a year earlier. Third-quarter adjusted EBITDA was $98 million, down 43%, and adjusted diluted earnings per share were $0.54 against $1.09 (ACI release, 5 November 2026).
- The price sits at the consensus target. MarketBeat's consensus target was $61.00, as reported by Defense World on 6 November 2026. The shares closed at $61.26 on 12 November 2026.
Price setup
The shares closed at $61.26 on 12 November 2026. They closed at $59.52 on 5 November 2026, $60.02 on 6 November 2026 and $61.85 on 11 November 2026, the highest close in this stretch. The 52-week intraday high is $63.10 on 5 November 2026, and the 52-week closing low is $38.47 on 23 February 2026.
The 50-day average is $53.39 and the 200-day average is $47.97, both as of the 12 November 2026 close. The shares trade about 15% above the 50-day average, so the post-report gain has not been tested by a pullback. Four sessions since the report have closed between $60.02 and $61.85.
No confirmed company event falls inside the next 30 days. Renewal news and price movement carry the shares until the fourth-quarter report. A close above the $63.10 intraday high would set a new 52-week high.
Catalysts ahead
- ~February 2027 (est.): Fourth-quarter and full-year 2026 results. Tests the $612 million–$642 million fourth-quarter revenue guide and shows whether the concentrated Payment Software renewals closed.
What would change the view
A daily close below $54.00, the former July breakout level, which would return the shares to their range before the third-quarter report. Fourth-quarter revenue below the $612 million low end of the guide, or a cut to full-year revenue guidance, would also break the case.
The risks this note tracks, each with what would confirm it:
- Fourth-quarter renewals slip or come in smaller, leaving the full-year revenue guide unmet. Confirmed by: fourth-quarter revenue below $612 million, or full-year revenue guidance cut below $1.895 billion.
- Payment Software recurring revenue keeps declining. Confirmed by: a second straight quarter of negative Payment Software recurring revenue growth after the 1% decline in the third quarter.
- The shares have already reached the consensus analyst target, leaving little room for upside. Confirmed by: analysts holding targets near $61 after the fourth-quarter report, or Needham keeping its Hold rating.
- The Biller sale option disappears without a transaction. Confirmed by: ACI states that the discussions reported by Reuters on 17 July 2026 ended without an agreement.
What it trades with
The shares move mainly on company events: renewal timing, quarterly guidance and the Biller sale report. The gain since late October came around the third-quarter report rather than with a sector-wide move. Payment Software depends on bank and processor technology budgets. Biller, which supplied $210 million of third-quarter revenue, depends on consumer and corporate bill-payment volumes. Because renewals are concentrated in the fourth quarter, results swing more from quarter to quarter than at subscription-software peers.
The evidence, claim by claim (8)
- Third-quarter 2026 revenue was $427 million, down 12%; adjusted EBITDA $98 million, down 43%; adjusted diluted EPS $0.54 versus $1.09 a year earlier. ACI Worldwide third-quarter 2026 earnings release, SEC Exhibit 99.1 · as of
- Third-quarter net new annual recurring revenue was $24 million, up 86%; trailing-twelve-month net new annual recurring revenue through 30 September 2026 was $79 million, down 3%. ACI Worldwide third-quarter 2026 earnings release, SEC Exhibit 99.1 · as of
- Payment Software third-quarter revenue was $216 million, down 24%; adjusted EBITDA $107 million, down 41%; recurring revenue $99 million, down 1%. ACI Worldwide third-quarter 2026 earnings release, SEC Exhibit 99.1 · as of
- Biller third-quarter revenue was $210 million, up 6%, with segment adjusted EBITDA of $34 million, up 4%. ACI Worldwide third-quarter 2026 earnings release, SEC Exhibit 99.1 · as of
- Full-year 2026 revenue guidance reiterated at $1.895 billion–$1.925 billion; adjusted EBITDA guidance raised to $550 million–$565 million; fourth-quarter revenue guided to $612 million–$642 million. ACI Worldwide third-quarter 2026 earnings release, SEC Exhibit 99.1 · as of
- Needham reiterated its Hold rating after the third-quarter report, citing the business model's dependence on lumpy renewals. Investing.com, 6 November 2026 · as of
- ACI repurchased about 935,000 shares for about $50 million in the third quarter; $299 million of buyback authorization remained. ACI Worldwide third-quarter 2026 earnings release, SEC Exhibit 99.1 · as of
- MarketBeat's consensus price target for ACI was $61.00. Defense World, 6 November 2026 · as of
Sources
- ACI WORLDWIDE, INC. - Form 8-K - FY2026 · sec.gov ·
- Needham reiterates Hold on ACI Worldwide stock after Q3 beat · investing.com ·
- ACI Worldwide (NASDAQ:ACIW) Sets New 52-Week High Following Earnings Beat · defenseworld.net ·
- ACI WORLDWIDE, INC. - Form 8-K - FY2026 · sec.gov ·