Visa Beats Estimates With 'Stable' Volumes; Mastercard On Deck

Visa reports strong earnings, Mastercard to follow

Visa Inc. reported better-than-expected earnings for the fourth quarter on Tuesday as payment volumes remained resilient despite recession fears. The company's net income rose 12% to $8.9 billion, or $1.93 per share, in the three months ended Sept. 30. Analysts had expected Visa to report earnings of $1.88 per share, according to Refinitiv data. Revenue climbed 11% to $8.6 billion, beating estimates of $8.5 billion.

Visa's results were driven by a 10% increase in payments volume, which reached $3.4 trillion. The company said cross-border volume grew 22% year-over-year, as travel rebounded from the pandemic. Visa also benefited from strong growth in e-commerce, which accounted for 28% of total volume.

Mastercard Inc., another major payment processor, is scheduled to report its fourth-quarter results on Thursday. Analysts expect Mastercard to report earnings of $2.66 per share on revenue of $5.8 billion, according to Refinitiv data.

What do Visa's results mean for investors?

Visa's strong results are a positive sign for the overall economy. The company's payment volumes are a key indicator of consumer spending, and the fact that they remained resilient in the face of recession fears is a good sign. Visa's results also suggest that the travel recovery is continuing, which is another positive sign for the economy.

For investors, Visa's results are a reminder that the company is a well-positioned player in the global payments market. The company has a strong track record of growth, and its latest results suggest that this growth is continuing. Visa's stock is currently trading at around $220 per share, and it could be a good investment for investors looking for exposure to the payments sector.

What to expect from Mastercard's results

Analysts expect Mastercard to report strong results for the fourth quarter, similar to Visa. The company is expected to benefit from the same tailwinds that helped Visa, such as the travel recovery and strong e-commerce growth. Mastercard is also expected to benefit from its recent acquisition of the Buy Now, Pay Later (BNPL) provider, Afterpay.

Investors will be looking for Mastercard to provide an update on its BNPL business. The company is expected to discuss its plans for integrating Afterpay into its platform and how it expects BNPL to contribute to its future growth. Mastercard's results could be a catalyst for the BNPL sector, which has been under pressure in recent months.

Conclusion

Visa's strong results are a positive sign for the overall economy and for investors. The company's payment volumes remained resilient in the face of recession fears, and the travel recovery is continuing. Mastercard is expected to report similar results when it reports its fourth-quarter earnings on Thursday. Investors will be looking for Mastercard to provide an update on its BNPL business.