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MasterCard (MA) Rises Yet Lags Behind Market: Some Facts Worth Knowing

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The most recent trading session ended with MasterCard (MA - Free Report) standing at $488.18, reflecting a +0.03% shift from the previouse trading day's closing. The stock's performance was behind the S&P 500's daily gain of 1.07%. Meanwhile, the Dow gained 0.31%, and the Nasdaq, a tech-heavy index, added 2.17%.

Coming into today, shares of the processor of debit and credit card payments had gained 6.24% in the past month. In that same time, the Business Services sector gained 5.24%, while the S&P 500 gained 2.92%.

The upcoming earnings release of MasterCard will be of great interest to investors. The company's upcoming EPS is projected at $3.72, signifying a 9.73% increase compared to the same quarter of the previous year. Our most recent consensus estimate is calling for quarterly revenue of $7.24 billion, up 10.8% from the year-ago period.

For the annual period, the Zacks Consensus Estimates anticipate earnings of $14.29 per share and a revenue of $27.92 billion, signifying shifts of +16.56% and +11.23%, respectively, from the last year.

Investors should also note any recent changes to analyst estimates for MasterCard. Recent revisions tend to reflect the latest near-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.

Research indicates that these estimate revisions are directly correlated with near-term share price momentum. 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 ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. Over the last 30 days, the Zacks Consensus EPS estimate has remained unchanged. MasterCard presently features a Zacks Rank of #3 (Hold).

With respect to valuation, MasterCard is currently being traded at a Forward P/E ratio of 34.15. Its industry sports an average Forward P/E of 16.45, so one might conclude that MasterCard is trading at a premium comparatively.

Meanwhile, MA's PEG ratio is currently 1.92. 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 was holding an average PEG ratio of 1.26 at yesterday's closing price.

The Financial Transaction Services industry is part of the Business Services sector. This industry, currently bearing a Zacks Industry Rank of 79, finds itself in the top 32% echelons 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.

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


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