MasterCard (MA) closed the most recent trading day at $251.56, moving -1.03% from the previous trading session. This change was narrower than the S&P 500’s 1.32% loss on the day. Elsewhere, the Dow lost 1.41%, while the tech-heavy Nasdaq lost 1.51%.
Prior to today’s trading, shares of the processor of debit and credit card payments had gained 2.83% over the past month. This has outpaced the Business Services sector’s loss of 1.14% and the S&P 500’s loss of 5.09% in that time.
MA will be looking to display strength as it nears its next earnings release. In that report, analysts expect MA to post earnings of $1.82 per share. This would mark year-over-year growth of 9.64%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $4.10 billion, up 11.81% from the year-ago period.
Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $7.60 per share and revenue of $16.78 billion. These totals would mark changes of +17.1% and +12.22%, respectively, from last year.
It is also important to note the recent changes to analyst estimates for MA. These revisions typically reflect the latest short-term business trends, which can change frequently. With this in mind, we can consider positive estimate revisions a sign of optimism about the company’s business outlook.
Research indicates that these estimate revisions are directly correlated with near-term share price momentum. 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, 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 0.13% higher. MA is currently a Zacks Rank #3 (Hold).
Valuation is also important, so investors should note that MA has a Forward P/E ratio of 33.43 right now. For comparison, its industry has an average Forward P/E of 22.12, which means MA is trading at a premium to the group.
Investors should also note that MA has a PEG ratio of 2.01 right now. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock’s expected earnings growth rate. Financial Transaction Services stocks are, on average, holding a PEG ratio of 1.84 based on yesterday’s closing prices.
The Financial Transaction Services industry is part of the Business Services sector. This group has a Zacks Industry Rank of 37, putting it in the top 15% of all 250+ industries.
The Zacks Industry Rank gauges the strength of our individual industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
Make sure to utilize Zacks. Com to follow all of these stock-moving metrics, and more, in the coming trading sessions.
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