In the latest trading session, MasterCard (MA) closed at $279.37, marking a -0.06% move from the previous day. This change lagged the S&P 500's daily gain of 0.02%. Meanwhile, the Dow gained 0.1%, and the Nasdaq, a tech-heavy index, added 0.17%.
Prior to today's trading, shares of the processor of debit and credit card payments had gained 7.02% over the past month. This has outpaced the Business Services sector's gain of 2.38% and the S&P 500's gain of 4.82% in that time.
Investors will be hoping for strength from MA as it approaches its next earnings release, which is expected to be July 30, 2019. In that report, analysts expect MA to post earnings of $1.82 per share. This would mark year-over-year growth of 9.64%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $4.10 billion, up 11.81% from the year-ago period.
Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $7.60 per share and revenue of $16.78 billion. These totals would mark changes of +17.1% and +12.23%, respectively, from last year.
Any recent changes to analyst estimates for MA should also be noted by investors. These recent revisions tend to reflect the evolving nature of short-term business trends. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.
Our research shows that these estimate changes are directly correlated with near-term stock prices. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.
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. Over the past month, the Zacks Consensus EPS estimate has moved 0.04% lower. MA is currently a Zacks Rank #3 (Hold).
Looking at its valuation, MA is holding a Forward P/E ratio of 36.78. This represents a premium compared to its industry's average Forward P/E of 24.31.
Investors should also note that MA has a PEG ratio of 2.21 right now. 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 industry currently had an average PEG ratio of 2.04 as of yesterday's close.
The Financial Transaction Services industry is part of the Business Services sector. This group has a Zacks Industry Rank of 83, putting it in the top 33% of all 250+ industries.
The Zacks Industry Rank gauges the strength of our individual 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.
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