Back to top

Image: Bigstock

Visa (V) Outpaces Stock Market Gains: What You Should Know

Read MoreHide Full Article

Visa (V - Free Report) closed the most recent trading day at $240.55, moving +1% from the previous trading session. The stock outpaced the S&P 500's daily gain of 0.67%. Meanwhile, the Dow gained 0.93%, and the Nasdaq, a tech-heavy index, added 9.29%.

Coming into today, shares of the global payments processor had gained 5.3% in the past month. In that same time, the Business Services sector gained 2.2%, while the S&P 500 gained 2.65%.

Investors will be hoping for strength from Visa as it approaches its next earnings release, which is expected to be July 25, 2023. On that day, Visa is projected to report earnings of $2.10 per share, which would represent year-over-year growth of 6.06%. Meanwhile, our latest consensus estimate is calling for revenue of $8.05 billion, up 10.69% from the prior-year quarter.

For the full year, our Zacks Consensus Estimates are projecting earnings of $8.59 per share and revenue of $32.52 billion, which would represent changes of +14.53% and +10.96%, respectively, from the prior year.

Investors should also note any recent changes to analyst estimates for Visa. These revisions typically reflect the latest short-term business trends, which can change frequently. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.

Research indicates that these estimate revisions are directly correlated with near-term share price momentum. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.

The Zacks Rank system ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate remained stagnant. Visa is currently a Zacks Rank #2 (Buy).

In terms of valuation, Visa is currently trading at a Forward P/E ratio of 27.74. This represents a premium compared to its industry's average Forward P/E of 14.24.

Meanwhile, V's PEG ratio is currently 1.82. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. Financial Transaction Services stocks are, on average, holding a PEG ratio of 1.23 based on yesterday's closing prices.

The Financial Transaction Services industry is part of the Business Services sector. This group has a Zacks Industry Rank of 159, putting it in the bottom 37% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

To follow V in the coming trading sessions, be sure to utilize Zacks.com.


See More Zacks Research for These Tickers


Normally $25 each - click below to receive one report FREE:


Visa Inc. (V) - free report >>

Published in