In the latest close session, MasterCard (MA) was down 2.06% at $564.55. The stock fell short of the S&P 500, which registered a loss of 0.28% for the day. On the other hand, the Dow registered a loss of 0.52%, and the technology-centric Nasdaq decreased by 0.08%.
The processor of debit and credit card payments's shares have seen a decrease of 0.51% over the last month, not keeping up with the Business Services sector's loss of 0.31% and the S&P 500's gain of 4.03%.
The investment community will be closely monitoring the performance of MasterCard in its forthcoming earnings report. The company is expected to report EPS of $4.3, up 10.54% from the prior-year quarter. Our most recent consensus estimate is calling for quarterly revenue of $8.48 billion, up 15.08% from the year-ago period.
Looking at the full year, the Zacks Consensus Estimates suggest analysts are expecting earnings of $16.32 per share and revenue of $32.43 billion. These totals would mark changes of +11.78% and +15.15%, respectively, from last year.
It is also important to note the recent changes to analyst estimates for MasterCard. These revisions typically reflect the latest short-term business trends, which can change frequently. Hence, positive alterations in estimates signify analyst optimism regarding the business and profitability.
Our research suggests that these changes in estimates have a direct relationship with upcoming stock price performance. 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, the Zacks Consensus EPS estimate has shifted 0.05% upward. Currently, MasterCard is carrying a Zacks Rank of #2 (Buy).
Looking at valuation, MasterCard is presently trading at a Forward P/E ratio of 35.32. This denotes a premium relative to the industry average Forward P/E of 14.77.
We can additionally observe that MA currently boasts a PEG ratio of 2.36. 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 Financial Transaction Services industry had an average PEG ratio of 1.23 as trading concluded yesterday.
The Financial Transaction Services industry is part of the Business Services sector. At present, this industry carries a Zacks Industry Rank of 39, placing it within the top 16% of over 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.
Don't forget to use Zacks.com to keep track of all these stock-moving metrics, and others, in the upcoming trading sessions.
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Mastercard Incorporated (MA): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).
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