Visa Inc. Reports Strong Market Performance and Impressive Earnings

With a market capitalization of $649.9 billion, Visa Inc. (V) operates as a payment technology company both in the United States and internationally. Founded in 1958 and based in San Francisco, California, it runs VisaNet, a transaction processing network that facilitates the authorization, clearing, and settlement of payment transactions. The company also provides various card products, including credit, debit, and prepaid options.

Performance Overview

Over the past year, Visa has outperformed the broader market. Its stock prices have surged by 26.7% over 52 weeks and 11.2% year-to-date (YTD), in contrast to the S&P 500 Index’s gains of 9.2% over the last year and a decline of 3.7% YTD.

Additionally, when compared to the iShares U.S. Financial Services ETF (IYG), which saw a 22.2% increase in the past year and a 2.5% rise this year, Visa’s growth stands out.

Q2 Earnings Highlights

On April 29, Visa shares rose 1.2% following the announcement of its Q2 earnings. The company’s net revenue reached $9.6 billion, a 9% year-over-year increase that exceeded analysts’ expectations. This growth was primarily propelled by an 8% rise in payment volume and a 9% increase in processed transactions. Furthermore, Visa’s non-GAAP earnings per share (EPS) grew 10% year-over-year, reaching $2.76, which also surpassed estimates by 3%.

Future Earnings Expectations

Looking ahead to the current fiscal year ending in September, analysts forecast a 12.8% decrease in Visa’s EPS to $11.34. Notably, Visa has a strong earnings surprise history, exceeding consensus estimates in all four recent quarters.

Analyst Ratings and Price Targets

The consensus rating for Visa stock remains a “Strong Buy.” Among 37 analysts, 28 categorize it as a “Strong Buy,” three recommend a “Moderate Buy,” and six suggest holding the stock.

In a recent analysis on April 30, Macquarie analyst Paul Golding maintained a “Buy” rating on Visa, adjusting the price target to $380 from a previous $400. The average price target of $380.40 indicates an expected upside of 8.3% from current price levels. In addition, the highest target set by analysts at $410 suggests a potential increase of 16.7%.

On the date of publication, Kritika Sarmah did not hold, either directly or indirectly, positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information, please view the Barchart Disclosure Policy here.

The views and opinions expressed herein are those of the author and do not necessarily reflect those of Nasdaq, Inc.