Visa (V): A Bull Case Theory

We came across a bullish thesis on Visa on Max Dividends's Substack. As of 2ⁿᵈ July, Visa's share was trading at $354.22. V's trailing and forward P/E were 35.60 and 27.98 respectively according to Yahoo Finance.

Visa (V) is the global leader in digital payments, providing transaction processing infrastructure that connects consumers, merchants, financial institutions, and government entities across more than 200 countries. The company has a history dating back to 1958, and has established itself as a dividend aristocrat with 15 consecutive years of annual dividend increases. Visa's dividend growth rate has been impressive, with a 17.5% CAGR over the past decade, and a conservative payout ratio of 20-25% of earnings.

Visa's future growth prospects are driven by global digital payment adoption, expansion in emerging markets, and innovation in fintech solutions. The company continues to benefit from the secular shift from cash to digital payments, with $16+ trillion in annual payment volume and 4.8+ billion cards in circulation. Key growth drivers include expansion in emerging markets, partnerships with central banks and local fintechs, and innovations in fintech and B2B payment solutions.

Visa is a resilient and growth-oriented dividend stock with a dominant market position, consistent free cash flow generation, and a management team that balances reinvestment with shareholder returns. Visa's high-margin business model, with ~70% EBITDA margins, and asset-light structure ensure resilience in economic downturns. The company's strong financials, growth prospects, and commitment to returning capital to investors make it an ideal forever holding, with a compelling dividend growth story and massive potential for long-term wealth creation.

Previously, we covered a bullish thesis on Visa by Jimmy Investor on March 21, 2025, which highlighted the company's potential to benefit from the AI energy boom through its critical infrastructure assets. The stock has not been directly covered since then under the same thesis. This is because the previous thesis - focused on energy infrastructure and AI - didn't directly align with Visa's core business. Max Dividends shares a similar view on Visa, emphasizing its resilient business model, dominant market position, and commitment to shareholder returns, but focuses on digital payment adoption and fintech innovation.

Visa isn't on our list of the 30 Most Popular Stocks Among Hedge Funds. While we acknowledge the risk and potential of Visa as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and have limited downside risk. If you are looking for an extremely cheap AI stock that is also a major beneficiary of Trump tariffs and onshoring, see our free report on the best short-term AI stock.

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Disclosure: None. This article was originally published at Insider Monkey.