Stock Profile: Jack Henry & Associates

Community banks and credit unions are often founded on a commitment to serving and investing in their communities, and can represent a local, values-aligned banking option for individuals and businesses. But to stay competitive with larger institutions in a rapidly evolving market, they need modern and reliable technology. Jack Henry & Associates (JKHY) provides innovative technology solutions that enable banks, credit unions, and businesses to better serve their customers. Its comprehensive suite of tools empowers community and regional institutions to provide accessible and affordable banking, particularly for underserved populations. 

Current Snapshot: A Competitive Edge

Founded in 1976, Jack Henry’s mission is to foster financial well-being through cutting-edge services tailored to traditional and non-traditional financial entities. The company currently provides core banking solutions to 940 banks, from newly established institutions to large organizations with up to $50 billion in assets. It also works with more than 710 credit unions of all sizes. Additionally, nearly 5,880 clients use Jack Henry’s specialized, non-core solutions. These personalized and data-driven services help lower barriers to financial health, positioning institutions of all sizes to reach their strategic goals and better support their communities.

Jack Henry’s technology includes integrated tools for processing deposits, loans, and general ledger transactions, along with systems for managing centralized customer and member data. The company supports both on-premise and private cloud environments through distinct core platforms, all integrated with a range of complementary solutions. In addition to core systems, the company offers a broad lineup of specialized, platform-agnostic products and services covering everything from financial performance and imaging to payments processing, cybersecurity, retail delivery, and online and mobile banking.

Jack Henry’s services are organized into four key segments: core, payments, complementary, and corporate and other. The core segment includes essential banking functions, as well as managing centralized customer or member data. The payments segment covers secure services such as ATM, debit, and credit card processing; online and mobile bill pay; and risk management tools. The complementary segment includes additional software, hosted processing platforms, and services such as call center support, network security management, consulting, and monitoring. The corporate and other category captures revenue and costs from hardware and other offerings that don’t fall into the first three segments.

These mission-critical systems are the backbone of banking operations, which is why Jack Henry’s customer retention remains exceptionally high, approaching 99% annually. Unlike larger competitors such as Fiserv and FIS, which have grown mostly through acquisitions, Jack Henry has expanded organically. That’s led to more unified platforms for banks and credit unions. This focused approach helps the company streamline its product offerings, maintain operating margins on par with bigger peers, and deepen customer relationships by cross-selling more than 140 complementary products.

Overall, the company’s patient growth strategy, focus on integrated platforms, and ability to strengthen customer relationships through cross-selling position it to outperform larger competitors over time. 

Social and Environmental Impact Review

Jack Henry announced a commitment to set science-based greenhouse gas (GHG) emissions targets aligned with the Science Based Target Initiative (SBTi) in December 2022. Using guidance from SBTi, the company is in the process of preparing near-term targets for Scope 1, 2, and 3 GHG emissions. In December 2023, Newsweek named Jack Henry one of America’s Most Responsible Companies. The ranking focuses on a holistic view of corporate responsibility that considers environment, social, and corporate governance. In the same year, the company received the Leader in Disability Inclusion Seal from the Center for Disability Inclusion and was named one of the Most Loved Workplaces® for LGBTQ+ Employees by the Best Practice Institute. 

With a strong commitment to financial inclusion, proactive environmental strategies, and solid governance practices, the company delivers value to its stakeholders while making a positive impact on society and the environment. 

Learn more about Jack Henry & Associates.