...most people and many so-called "professional investors" do not understand the mastercard business model...not even remotely. then they panic and/or forewarn everyone that the "MA crash is coming!!!!", "somebody has sold a million shares at lower than current market", "p/e is way too high", "MA is overbought", "there was a head-and-shoulder, needle, double needle....or whatever nonsense terms the charties come up", etc. etc. etc. i've been hearing this EXACT whining since MA was in the 50s!!...and they've ALL - each and every one of them - has been wrong! all the while, i keep buying, and buying and buying...and have made a tremendous return (and yes...like any investment, there is a bit of good fortune in it as well). these message boards do not influence the price a bit (way too small)..however, for those of you on the cusp....in my humble opinion, don't worry about MA...it'll continue to do well...very well. investing is simply and solely about making money and keeping your earnings...every stock goes up and down. take some time, understand the market and make your own decision. remember, there are no experts. (p.s. none of this applies to day-traders...in which case ma could be a great buy one minute and a great sell the next...that's a ballgame i stay away from.). so...why do i make so much money on MA? I buy. good luck all!
Thanks you for the good advice.
i see this message board to read at what some idiots have to say.
and at many, many times.........they have been totally wrong.
these 15-20 opinions on this board do not run the market.
but sometimes you get good opinions too....like the one you put today.............thanks
You're kidding yourself if you think GS didn't understand MA's business model. I think much of the price increase is due to a clearer legal/regulation picture for MA since the IPO.
GS and institutional investors could see a too many legal/reg costs on the horizon that were too difficult to price. Since the IPO, MA has had a few wins/settlements with VISA and in the EU that allowed the share price to go up as these risks became less open-ended.
problem is I have defended mastercard since it was 90 bucks.
We have since had a near double and yeah...im nervous that the valuation that i have on it will fall short.
BUT ITS REAL....
I think this stock goes to 250 next year!
WE..there are more longs than idiot shorts
5.66 divided by 165 = 33 P/E
with a 25% growth rate year over year we can pay up to 50 times earnings
5.66 2008 times 50P/E = $283
5.66 2008 times 40P/E = $226
Either way it only makes sense to buy this bad boy NOW NOW NOW
Sentiment : Strong Buy
Okay, I see where you get your number from. Don't agree with the premise, but at least you're trying.
Just FYI, typically if you're attaching a higher P/E to a stock than the S&P, you usually use the number that equals the growth rate. So for example if a company is growing at 25%, they usually get somewhere between a 25 and 30 P/E. In this market, they may get a 35, but going all the way to 40 and for that matter 50, is a real stretch (because now your doubling the discounted earnings growth target that hasn't even occured yet). At 30 P/E, they should trade at $169.80 (but that is for all of this and next year).
At a 35 P/E, the number is $198.10. That is as high as I am willing to go. Good luck.
Interesting thoughts. MA had better begin to move itself away from being the middle-man if it can...as we all know that this is a prone position to be in.
Regarding Goldman, do you really believe that they were wrong by a factor of 2 to 3? Where was management? If so, this has cost the company hundreds of millions of dollars which it could have used to stay/gain competative, strategic investments, capital investments,legal liability, a real dividend....and to compound the problem, you can be sure VISA will cash in!
Ok...this is good. I believe there is a tremendous value in Mastercard that is NOT being realized, not being discussed in the media, and not figured into forward looking profit. Mastercard has ALWAYS been restricted from having a direct relationship with the merchant and with the cardholder. The board (made up entirely of banks) prevented this from happening (the banks wanted to keep that relationship). I am making an educated guess (and that's all that it is), that Mastercard (apart from its penatration into paper transactions, and international growth) will make a play directly to the merchant (offering new services, products, etc) and to the consumer (different services like online identity, authentication, "all in one card (health records, ids, etc"). I'm playing the "brand" and acceptance angle as well as the growth in processing.
P.S. We have to agree to disagree on Goldman (better people than you or I (or Joe and Schmoe) have made bigger mistakes in more important issues than money...no one gets it right all the time....in fact some "experts" TODAY say to BUY MA, some say HOLD, some say SELL...which expert is right/wrong>). I never said MA would go to the moon (just alot higher than where it is today). And yes, I will/have bought at today's level.
No short cuts on this one.....Laugh out loud!
You know Mastercards business model better than management and Goldman who both priced the IPO!!! Either they are crooks or this stock is alittle bloated.
With all due respect.....Do you actually believe the individual(s) at Goldman Sachs are EXPERTS? Please understand that it was not "Goldman Sachs" that priced MA (Goldman Sachs is a firm...not a thinking individual)...it was a couple individuals...Joe and Schmoe. Sounds like Goldman's image and advertising has the better of you....oh well.
And yes, I am extremely knowledgeable of the business model....I worked in the industry for over 25 years.....the processing side, the issuer side, and the acquirer side. I understand the fee structure, impact of exchange rates....
I'm sorry to say that there probably were no crooks...no conspiracy....or anything like that. MA was simply underpriced at the IPO. Joe and Schmoe simply made a mistake...a big one. This happens...no one is an expert.
Understand that AFTER the IPO, the relationship between MA and the merchants...and MA and the Banks.....and MA and the consumer (cardholder) changed tremendously. ALL to MA's advantage.
Yup...while you're crying "momentum", many of us are laughing out loud all the way to the bank! ....but good luck to you...
Well, this will bloat itself to 150 plus today. Markets are gonna be up by 400-500 by end of day with no inflation. We will see 14K by weekend. NasDaq headed towards 3K. These are the beginning of the golden years of US Stock Market. Long live Bush...long live Bernanke !!, the two great visionaries....wahoo.
stock is priced right - the market is always right. We go higher from here.
You said it was bloated at 110. Stop looking at where the stock has been.
$200/share is on the horizon.
Next you will tell us that it has a 133 P/E and that is why we should sell our shares.
Get with the program.
I don't think you would argue that the IPO price was way low...not sure if it was crooks or just stupidity. The fact that Vonage IPO had just crashed the day before lowered it 2.5% before it even opened (was supposed to start over 40.
Is it over priced? Maybe, but there is someone, somewhere who feels it isn't and is currently bidding $136.64 which, by definition is the current market value