Visa Inc. (V) reported earnings on Wednesday afternoon, and the company did not disappoint - although shares traded modestly lower during after-hours trading. Profit numbers beat the general consensus leading into the report and were up by 26% over the same quarter for the previous year. Encouragingly enough, much of the profit spike was attributed to increase in consumer spending on credit cards, which is not just a good sign for Visa, but also a good sign for the economy as it is indicative of consumer confidence. Also key from this report was a surge in profits from other areas of the globe, specifically in the MENA, South and Central America and European regions. As the company looks to infiltrate other areas of the world, too, that may not yet be saturated with the means to pay for merchandise electronically, Visa offers a continued avenue for growth.
More than digesting this earnings report for the potential of Visa as an investment, however, it could be used as amplifying information to gauge the health of the overall economy. Consumers feeling confident about spending, while worrisome in one right if too much debt is being racked up, is a good sign that the economy, wages and jobs numbers are on the upswing.
Wednesday's report should satisfy those looking for potential growth in Asia and other areas of the world as consumer confidence and spending continues to rise, especially if the after-hours trend continues into Thursday trading and allows investors to buy on any "sell the news" weakness, while investors eyeing the report strictly as a sign of the health of the recovery should also move forward in a satisfied manner