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MasterCard (MA) Gains As Market Dips: What You Should Know

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In the latest trading session, MasterCard (MA - Free Report) closed at $276.38, marking a +0.17% move from the previous day. This move outpaced the S&P 500's daily loss of 0.14%. Elsewhere, the Dow lost 0.11%, while the tech-heavy Nasdaq lost 0.1%.

Heading into today, shares of the processor of debit and credit card payments had lost 0.18% over the past month, lagging the Business Services sector's gain of 0.35% and outpacing the S&P 500's loss of 0.91% in that time.

Investors will be hoping for strength from MA as it approaches its next earnings release, which is expected to be October 29, 2019. In that report, analysts expect MA to post earnings of $2.01 per share. This would mark year-over-year growth of 12.92%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $4.42 billion, up 13.5% from the year-ago period.

MA's full-year Zacks Consensus Estimates are calling for earnings of $7.61 per share and revenue of $16.81 billion. These results would represent year-over-year changes of +17.26% and +12.42%, respectively.

Any recent changes to analyst estimates for MA should also be noted by investors. These revisions help to show the ever-changing nature of near-term business trends. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.

Our research shows that these estimate changes are directly correlated with near-term stock prices. 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 0.03% lower. MA currently has a Zacks Rank of #3 (Hold).

In terms of valuation, MA is currently trading at a Forward P/E ratio of 36.27. This represents a premium compared to its industry's average Forward P/E of 24.85.

Also, we should mention that MA has a PEG ratio of 2.29. 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 1.63 at yesterday's closing price.

The Financial Transaction Services industry is part of the Business Services sector. This industry currently has a Zacks Industry Rank of 159, which puts it in the bottom 38% 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.

Be sure to follow all of these stock-moving metrics, and many more, on Zacks.com.


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