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Visa (V) Dips More Than Broader Markets: What You Should Know

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In the latest trading session, Visa (V - Free Report) closed at $171.06, marking a -0.13% move from the previous day. This change lagged the S&P 500's 0.12% loss on the day. Elsewhere, the Dow lost 0.04%, while the tech-heavy Nasdaq added 0.32%.

Prior to today's trading, shares of the global payments processor had gained 4.62% over the past month. This has outpaced the Business Services sector's gain of 3.89% and the S&P 500's gain of 3.31% in that time.

Wall Street will be looking for positivity from V as it approaches its next earnings report date. In that report, analysts expect V to post earnings of $1.33 per share. This would mark year-over-year growth of 10.83%. Our most recent consensus estimate is calling for quarterly revenue of $5.70 billion, up 8.78% from the year-ago period.

Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $5.37 per share and revenue of $22.75 billion. These totals would mark changes of +16.49% and +10.4%, respectively, from last year.

Investors should also note any recent changes to analyst estimates for V. 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 past month, the Zacks Consensus EPS estimate has moved 0.16% lower. V is holding a Zacks Rank of #3 (Hold) right now.

Investors should also note V's current valuation metrics, including its Forward P/E ratio of 31.92. This represents a premium compared to its industry's average Forward P/E of 23.5.

Meanwhile, V's PEG ratio is currently 1.94. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. The Financial Transaction Services industry currently had an average PEG ratio of 1.94 as of yesterday's close.

The Financial Transaction Services industry is part of the Business Services sector. This group has a Zacks Industry Rank of 24, putting it in the top 10% of all 250+ industries.

The Zacks Industry Rank includes is listed in order from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

You can find more information on all of these metrics, and much more, on Zacks.com.


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