Zacks Investment Research Upgrades Mastercard (MA) to “Buy”

Mastercard (NYSE:MA) was upgraded by Zacks Investment Research from a “hold” rating to a “buy” rating in a report released on Thursday. The brokerage presently has a $235.00 price objective on the credit services provider’s stock. Zacks Investment Research‘s price objective indicates a potential upside of 19.59% from the company’s previous close.

According to Zacks, “Mastercard’s stock has outperformed the industry in a year's time. The stock have witnessed its 2018 move upward over the past 60 days. The company is poised for growth, given its solid market position, ongoing expansion and digital initiatives plus significant opportunities from the secular shift toward electronic payments. Its numerous acquisitions have aided revenue growth. The company is gaining from increase in switched transactions, cross-border volume and gross dollar volume from higher spending. However, escalating costs will put pressure on the company’s bottom line. Also, Mastercard has been incurring quite high levels of costs under rebates and incentives, which remains a concern.”

Other equities research analysts have also recently issued reports about the stock. Royal Bank of Canada lifted their price objective on shares of Mastercard from $223.00 to $232.00 and gave the company an “outperform” rating in a research note on Tuesday, September 11th. They noted that the move was a valuation call. Goldman Sachs Group upgraded shares of Mastercard from a “buy” rating to a “conviction-buy” rating in a research note on Monday, September 17th. BMO Capital Markets started coverage on shares of Mastercard in a research note on Wednesday, September 26th. They set an “outperform” rating and a $238.00 price objective on the stock. Wells Fargo & Co lifted their price objective on shares of Mastercard from $230.00 to $250.00 and gave the company an “outperform” rating in a research note on Monday, October 1st. Finally, Credit Suisse Group lifted their price objective on shares of Mastercard from $210.00 to $224.00 and gave the company an “outperform” rating in a research note on Monday, October 8th. Three equities research analysts have rated the stock with a hold rating, twenty-six have assigned a buy rating and two have issued a strong buy rating to the company. The company currently has a consensus rating of “Buy” and an average target price of $221.28.

Shares of MA opened at $196.50 on Thursday. Mastercard has a 1 year low of $149.17 and a 1 year high of $225.35. The firm has a market cap of $209.65 billion, a PE ratio of 42.90, a PEG ratio of 1.74 and a beta of 1.21. The company has a debt-to-equity ratio of 1.01, a current ratio of 1.55 and a quick ratio of 1.55.

Mastercard (NYSE:MA) last announced its quarterly earnings results on Tuesday, October 30th. The credit services provider reported $1.78 earnings per share (EPS) for the quarter, beating the consensus estimate of $1.68 by $0.10. Mastercard had a net margin of 35.88% and a return on equity of 114.58%. The company had revenue of $3.90 billion during the quarter, compared to the consensus estimate of $3.86 billion. During the same quarter in the previous year, the company posted $1.34 earnings per share. The company’s revenue for the quarter was up 14.7% compared to the same quarter last year. On average, analysts anticipate that Mastercard will post 6.43 earnings per share for the current year.

Mastercard announced that its Board of Directors has approved a stock repurchase program on Tuesday, December 4th that allows the company to repurchase $6.50 million in outstanding shares. This repurchase authorization allows the credit services provider to repurchase shares of its stock through open market purchases. Stock repurchase programs are typically an indication that the company’s management believes its shares are undervalued.

In other Mastercard news, Director Richard K. Davis purchased 2,475 shares of the company’s stock in a transaction on Friday, November 2nd. The shares were purchased at an average cost of $196.37 per share, for a total transaction of $486,015.75. Following the completion of the transaction, the director now owns 3,468 shares in the company, valued at $681,011.16. The purchase was disclosed in a document filed with the Securities & Exchange Commission, which is available through this hyperlink. 0.32% of the stock is currently owned by insiders.

Institutional investors have recently modified their holdings of the business. Capital Guardian Trust Co. purchased a new position in Mastercard in the 3rd quarter worth about $103,000. Baker Ellis Asset Management LLC purchased a new position in Mastercard during the 3rd quarter valued at about $104,000. Bay Colony Advisory Group Inc d b a Bay Colony Advisors purchased a new position in Mastercard during the 2nd quarter valued at about $109,000. Fort L.P. purchased a new position in Mastercard during the 2nd quarter valued at about $120,000. Finally, Point72 Hong Kong Ltd purchased a new position in Mastercard during the 2nd quarter valued at about $131,000. Hedge funds and other institutional investors own 74.84% of the company’s stock.

Mastercard Company Profile

Mastercard Incorporated, a technology company, provides transaction processing and other payment-related products and services in the United States and internationally. It facilitates the processing of payment transactions, including authorization, clearing, and settlement, as well as delivers related products and services.

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