MasterCard (MA) closed at $598.63 in the latest trading session, marking a +2.08% move from the prior day. The stock's change was more than the S&P 500's daily loss of 0.1%. At the same time, the Dow added 0.57%, and the tech-heavy Nasdaq lost 0.33%.
The processor of debit and credit card payments's shares have seen an increase of 0.16% over the last month, not keeping up with the Business Services sector's gain of 1.53% and the S&P 500's gain of 2.57%.
Market participants will be closely following the financial results of MasterCard in its upcoming release. The company is predicted to post an EPS of $4.3, indicating a 10.54% growth compared to the equivalent quarter last year. Meanwhile, the latest consensus estimate predicts the revenue to be $8.48 billion, indicating a 15.08% increase compared to the same quarter of the previous year.
In terms of the entire fiscal year, the Zacks Consensus Estimates predict earnings of $16.32 per share and a revenue of $32.42 billion, indicating changes of +11.78% and +15.1%, respectively, from the former year.
Investors should also take note of any recent adjustments to analyst estimates for MasterCard. These revisions help to show the ever-changing nature of near-term business trends. Hence, positive alterations in estimates signify analyst optimism regarding the business and profitability.
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, stretching from #1 (Strong Buy) to #5 (Strong Sell), has a noteworthy track record of outperforming, validated by third-party audits, with stocks rated #1 producing an average annual return of +25% since the year 1988. Over the past month, there's been a 0.05% rise in the Zacks Consensus EPS estimate. At present, MasterCard boasts a Zacks Rank of #3 (Hold).
Digging into valuation, MasterCard currently has a Forward P/E ratio of 35.94. Its industry sports an average Forward P/E of 15.97, so one might conclude that MasterCard is trading at a premium comparatively.
It's also important to note that MA currently trades at a PEG ratio of 2.4. The PEG ratio bears resemblance to the frequently used P/E ratio, but this parameter also includes the company's expected earnings growth trajectory. The average PEG ratio for the Financial Transaction Services industry stood at 1.24 at the close of the market yesterday.
The Financial Transaction Services industry is part of the Business Services sector. Currently, this industry holds a Zacks Industry Rank of 56, positioning it in the top 23% of all 250+ industries.
The strength of our individual industry groups is measured by the Zacks Industry Rank, which is calculated based on the average Zacks Rank of the individual stocks within these groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
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Mastercard Incorporated (MA): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).
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