Tag: DoubleDigit

Mastercard: Double-Digit Growth For Over A Decade – Priceless (NYSE:MA)

Investment Thesis

Mastercard’s (MA) network is a critical part of the payments infrastructure across the globe, providing support for various types of digital and mobile payments, both of which are expected to grow rapidly in the coming years. But Mastercard is also helping to shape the future of real-time payments – another space that is expect to grow quickly. Mastercard’s essential role in these markets, combined with its exceptionally profitable business model, makes this stock a compelling long-term investment.

Mastercard’s Business Model

Mastercard is one of the largest payment networks in the world, behind Visa (V) and China-based UnionPay. It has over 2.2 billion payment cards in circulation, which are accepted in over 210 countries (and territories) by over 37 million merchants.

Mastercard, like Visa, is an open network – it processes payments, but does not issue cards. Instead, it works with other financial institutions that issue cards branded with

Read More

Visa: Continuing Recovery Brings Double-Digit Annualised Return (NYSE:V)


We review Visa (V) (Buy-rated in our coverage) ahead of FY20 results on October 28, referencing last quarter’s results, recent volume data and management comments.

Since our initial Buy rating in June 2019, Visa shares have returned 25.3% (including dividends), slightly ahead of the S&P 500, behind Mastercard (MA) (Buy-rated) and PayPal (PYPL) (also Buy-rated), but far ahead of American Express (AXP) (Neutral-rated):

Stable Year-on-Year Volume Trends

The last set of Visa volume data was for August, which showed stable year-on-year trends in U.S. payments, with a 7% year-on-year growth (8% in July):

Debit card volume continues to lead the recovery, partly due to consumers using their debit cards in purchases that were previously made with cash withdrawn from ATMs. The year-on-year decline in Card Present decelerated slightly in late August, but volume was still down high-single-digits. Card Not Present (Excluding Travel) volume remained at 30% higher year-on-year.


Read More

Mastercard: Double-Digit Return Thesis Intact Despite 10% Correction (NYSE:MA)


We review our investment case on Mastercard (NYSE:MA) after shares corrected by nearly 10% from their $367.25 peak on August 28.

Since our initial Buy rating in March 2019, MA shares have returned 41.8% (including dividends), more than double that of the S&P 500:

The move to digital payments is a strong secular trend, and we also have Buy ratings on Visa (V) and PayPal (PYPL), which have also done well; we have been Neutral on American Express (AXP), which underperformed as expected.

We last reiterated our Buy rating on MA in May. In this article, we utilise the company’s Q2 2020 results and post-Q2 volume data, as well as comments by senior executives at investor conferences.

Volumes Now in “Normalization” Phase

MA management believes that most markets are now in the “normalization” phase of the COVID-19 outbreak, but not yet resuming “growth”:

“Remember us talking about a four-stage

Read More