Advertisement
Canada markets closed
  • S&P/TSX

    22,167.03
    +59.95 (+0.27%)
     
  • S&P 500

    5,254.35
    +5.86 (+0.11%)
     
  • DOW

    39,807.37
    +47.29 (+0.12%)
     
  • CAD/USD

    0.7381
    -0.0005 (-0.07%)
     
  • CRUDE OIL

    83.11
    -0.06 (-0.07%)
     
  • Bitcoin CAD

    94,362.66
    -1,349.12 (-1.41%)
     
  • CMC Crypto 200

    885.54
    0.00 (0.00%)
     
  • GOLD FUTURES

    2,254.80
    +16.40 (+0.73%)
     
  • RUSSELL 2000

    2,124.55
    +10.20 (+0.48%)
     
  • 10-Yr Bond

    4.2060
    +0.0100 (+0.24%)
     
  • NASDAQ

    16,379.46
    -20.06 (-0.12%)
     
  • VOLATILITY

    13.01
    0.00 (0.00%)
     
  • FTSE

    7,952.62
    +20.64 (+0.26%)
     
  • NIKKEI 225

    40,369.44
    +201.37 (+0.50%)
     
  • CAD/EUR

    0.6842
    -0.0001 (-0.01%)
     

Will Higher Transactions Processed Aid Visa (V) Q1 Earnings?

Growth in the number of transactions processed, one of the key revenue drivers for Visa Inc. V, is likely to have benefited its first-quarter fiscal 2020 performance.

Data processing revenues consist of revenues earned for authorization, clearing, settlement, network access and other maintenance and support services that facilitate transaction and information processing among the company's clients globally. Number of processed transactions drives Visa’s Data processing revenues, which formed nearly 35% of its total revenues in fiscal 2019.

So, let’s check how processed transactions might have impacted the company’s performance in the to-be-reported quarter. Click here to know how the company’s overall first-quarter fiscal 2020 performance is expected to be.

Let’s Delve Deeper

In fiscal 2019, revenues from Data Processing increased 14% to $10.3 billion on 11% growth in transactions processed.

ADVERTISEMENT

The Zacks Consensus Estimate for revenues from this business line is pegged at $2.85 billion, indicating an increase of 15.2% year over year on an expected 12.5% improvement in processed transactions to 49.9 billion.
Region wise, Visa’s transaction processed is likely to have benefited from Europe (expected to have climbed 6%), Asia Pacific (5.6%), CEMEA (24.7%), Lac (9.3%), Canada (7.1%) and the United States (8.6%).

The number of transactions processed is expected to have risen in the quarter under review, as in the past few quarters, due to the ongoing worldwide shift to electronic payments.

Massive investments in technology helped the company to process higher transactions every quarter and the same is likely to have continued in the fiscal first quarter.

Growing acceptance of its products and expansion of its merchant network are likely to drive the number of transactions processed. At the end of 2019, the company had more than 61 million physical merchant locations, up 14% from 2018. Notably, merchant location is the physical location at which transaction takes place.

Earnings & Revenue Expectations

The Zacks Consensus Estimate for earnings per share is pegged at $1.46, which suggests a 12.3% increase from the year-ago quarter’s reported number. Also, the consensus estimate for sales of $6.06 billion indicates a rise of 10.1%.

Visa Inc. Price and EPS Surprise

Visa Inc. Price and EPS Surprise
Visa Inc. Price and EPS Surprise

Visa Inc. price-eps-surprise | Visa Inc. Quote

Visa carries a Zacks Rank #3 (Hold).

Stocks That Warrant a Look

Here are a few finance stocks expected to beat earnings estimates this season:

Global Payments Inc. GPN has an Earnings ESP of +3.15% and a Zacks Rank of 2 (Buy).

You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Fidelity Information Services, Inc. FIS has an Earnings ESP of +0.45% and a Zacks Rank #2.

Square, Inc. SQ has an Earnings ESP of +6.14% and a Zacks Rank #3.

5 Stocks Set to Double

Each was hand-picked by a Zacks expert as the #1 favorite stock to gain +100% or more in 2020. Each comes from a different sector and has unique qualities and catalysts that could fuel exceptional growth.

Most of the stocks in this report are flying under Wall Street radar, which provides a great opportunity to get in on the ground floor.

Today, See These 5 Potential Home Runs >>


Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
 
Square, Inc. (SQ) : Free Stock Analysis Report
 
Visa Inc. (V) : Free Stock Analysis Report
 
Fidelity National Information Services, Inc. (FIS) : Free Stock Analysis Report
 
Global Payments Inc. (GPN) : Free Stock Analysis Report
 
To read this article on Zacks.com click here.