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MasterCard (MA) Dips More Than Broader Markets: What You Should Know

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MasterCard (MA - Free Report) closed the most recent trading day at $255.89, moving -0.4% from the previous trading session. This change lagged the S&P 500's 0.05% loss on the day. At the same time, the Dow added 0.17%, and the tech-heavy Nasdaq lost 0.01%.

Prior to today's trading, shares of the processor of debit and credit card payments had gained 0.17% over the past month. This has lagged the Business Services sector's gain of 16.54% and the S&P 500's gain of 21.82% in that time.

Wall Street will be looking for positivity from MA as it approaches its next earnings report date. This is expected to be April 29, 2020. The company is expected to report EPS of $1.75, down 1.69% from the prior-year quarter. Meanwhile, our latest consensus estimate is calling for revenue of $3.96 billion, up 1.81% from the prior-year quarter.

For the full year, our Zacks Consensus Estimates are projecting earnings of $7.40 per share and revenue of $16.61 billion, which would represent changes of -4.76% and -1.63%, respectively, from the prior year.

Investors should also note any recent changes to analyst estimates for MA. 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.

Our research shows that these estimate changes are directly correlated with near-term stock prices. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable 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. Within the past 30 days, our consensus EPS projection has moved 14.66% lower. MA is holding a Zacks Rank of #3 (Hold) right now.

Valuation is also important, so investors should note that MA has a Forward P/E ratio of 34.74 right now. This valuation marks a premium compared to its industry's average Forward P/E of 20.46.

We can also see that MA currently has a PEG ratio of 2.52. 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. MA's industry had an average PEG ratio of 1.49 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 209, putting it in the bottom 19% 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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