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MasterCard (MA) Stock Slides as Market Rises: Facts to Know Before You Trade

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The latest trading session saw MasterCard (MA - Free Report) ending at $446.24, denoting a -0.72% adjustment from its last day's close. This change lagged the S&P 500's daily gain of 0.1%. Elsewhere, the Dow lost 0.08%, while the tech-heavy Nasdaq added 0.28%.

Prior to today's trading, shares of the processor of debit and credit card payments had lost 0.07% over the past month. This has lagged the Business Services sector's gain of 2.1% and the S&P 500's gain of 4.08% in that time.

Market participants will be closely following the financial results of MasterCard in its upcoming release. The company's earnings per share (EPS) are projected to be $3.51, reflecting a 21.45% increase from the same quarter last year. In the meantime, our current consensus estimate forecasts the revenue to be $6.85 billion, indicating a 9.28% growth compared to the corresponding quarter of the prior year.

For the full year, the Zacks Consensus Estimates are projecting earnings of $14.26 per share and revenue of $27.8 billion, which would represent changes of +16.31% and +10.75%, respectively, from the prior year.

Investors should also note any recent changes to analyst estimates for MasterCard. These latest adjustments often mirror the shifting dynamics of short-term business patterns. 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. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.

The Zacks Rank system, which varies between #1 (Strong Buy) and #5 (Strong Sell), carries an impressive track record of exceeding expectations, confirmed by external audits, with stocks at #1 delivering an average annual return of +25% since 1988. Over the last 30 days, the Zacks Consensus EPS estimate has remained unchanged. As of now, MasterCard holds a Zacks Rank of #4 (Sell).

In terms of valuation, MasterCard is presently being traded at a Forward P/E ratio of 31.52. This valuation marks a premium compared to its industry's average Forward P/E of 15.19.

It's also important to note that MA currently trades at a PEG ratio of 1.75. 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. The Financial Transaction Services industry had an average PEG ratio of 0.97 as trading concluded yesterday.

The Financial Transaction Services industry is part of the Business Services sector. Currently, this industry holds a Zacks Industry Rank of 62, positioning it in the top 25% of all 250+ industries.

The strength of our individual industry groups is measured by the Zacks Industry Rank, which is calculated based on the average Zacks Rank of the individual stocks within these groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Remember to apply Zacks.com to follow these and more stock-moving metrics during the upcoming trading sessions.


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