Canada markets close in 1 hour 2 minutes
  • S&P/TSX

    +46.27 (+0.29%)
  • S&P 500

    +17.85 (+0.52%)
  • DOW

    +161.15 (+0.57%)

    -0.0001 (-0.01%)

    +0.59 (+1.47%)

    +2,588.21 (+17.79%)
  • CMC Crypto 200

    +6.94 (+2.71%)

    -22.90 (-1.19%)
  • RUSSELL 2000

    +24.06 (+1.50%)
  • 10-Yr Bond

    +0.0270 (+3.31%)

    +24.14 (+0.21%)

    -0.79 (-2.76%)
  • FTSE

    +9.15 (+0.16%)
  • NIKKEI 225

    -165.19 (-0.70%)

    +0.0022 (+0.34%)

Visa (V) Gains But Lags Market: What You Should Know

Zacks Equity Research
·3 mins read

Visa (V) closed at $205.39 in the latest trading session, marking a +0.2% move from the prior day. This move lagged the S&P 500's daily gain of 0.52%. Elsewhere, the Dow gained 0.01%, while the tech-heavy Nasdaq added 1.21%.

Prior to today's trading, shares of the global payments processor had gained 2.78% over the past month. This has outpaced the Business Services sector's gain of 1.02% and the S&P 500's gain of 0.49% in that time.

Investors will be hoping for strength from V as it approaches its next earnings release. On that day, V is projected to report earnings of $1.10 per share, which would represent a year-over-year decline of 25.17%. Our most recent consensus estimate is calling for quarterly revenue of $5.03 billion, down 18.01% from the year-ago period.

V's full-year Zacks Consensus Estimates are calling for earnings of $5.01 per share and revenue of $21.78 billion. These results would represent year-over-year changes of -7.9% and -5.21%, respectively.

Investors should also note any recent changes to analyst estimates for V. These revisions help to show the ever-changing nature of near-term business trends. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.

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. The Zacks Consensus EPS estimate has moved 0.28% higher within the past month. V is currently a Zacks Rank #3 (Hold).

Digging into valuation, V currently has a Forward P/E ratio of 40.91. For comparison, its industry has an average Forward P/E of 26.63, which means V is trading at a premium to the group.

Also, we should mention that V has a PEG ratio of 3.12. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. The Financial Transaction Services was holding an average PEG ratio of 1.51 at yesterday's closing price.

The Financial Transaction Services industry is part of the Business Services sector. This group has a Zacks Industry Rank of 77, putting it in the top 31% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our 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.

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
Visa Inc. (V) : Free Stock Analysis Report
To read this article on click here.