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Visa (V) Increases Yet Falls Behind Market: What Investors Need to Know

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Visa (V - Free Report) closed at $255.82 in the latest trading session, marking a +0.6% move from the prior day. The stock trailed the S&P 500, which registered a daily gain of 0.8%. On the other hand, the Dow registered a gain of 0.18%, and the technology-centric Nasdaq increased by 1.37%.

Coming into today, shares of the global payments processor had gained 4.26% in the past month. In that same time, the Business Services sector gained 7.85%, while the S&P 500 gained 4.39%.

The investment community will be closely monitoring the performance of Visa in its forthcoming earnings report. It is anticipated that the company will report an EPS of $2.33, marking a 6.88% rise compared to the same quarter of the previous year. Our most recent consensus estimate is calling for quarterly revenue of $8.51 billion, up 7.19% from the year-ago period.

In terms of the entire fiscal year, the Zacks Consensus Estimates predict earnings of $9.90 per share and a revenue of $35.75 billion, indicating changes of +12.88% and +9.48%, respectively, from the former year.

Investors should also note any recent changes to analyst estimates for Visa. These revisions help to show the ever-changing nature of near-term business trends. As a result, upbeat changes in estimates indicate analysts' favorable outlook on the company's business health and profitability.

Our research demonstrates that these adjustments in estimates directly associate with imminent stock price performance. To exploit this, we've formed the Zacks Rank, a quantitative model that includes these estimate changes and presents a viable 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 last 30 days, the Zacks Consensus EPS estimate has moved 0.29% higher. Visa is currently sporting a Zacks Rank of #3 (Hold).

With respect to valuation, Visa is currently being traded at a Forward P/E ratio of 25.69. This represents a premium compared to its industry's average Forward P/E of 13.72.

Investors should also note that V has a PEG ratio of 1.72 right now. 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. V's industry had an average PEG ratio of 1.15 as of yesterday's close.

The Financial Transaction Services industry is part of the Business Services sector. Currently, this industry holds a Zacks Industry Rank of 150, positioning it in the bottom 41% of all 250+ industries.

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

Make sure to utilize Zacks.com to follow all of these stock-moving metrics, and more, in the coming trading sessions.


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