In the latest trading session, Visa (V) closed at $198.71, marking a -1.33% move from the previous day. This move lagged the S&P 500's daily loss of 0.78%. Elsewhere, the Dow lost 0.88%, while the tech-heavy Nasdaq lost 0.26%.
Prior to today's trading, shares of the global payments processor had lost 2.37% over the past month. This has was narrower than the Business Services sector's loss of 6.43% and the S&P 500's loss of 3.4% in that time.
Wall Street will be looking for positivity from Visa as it approaches its next earnings report date. On that day, Visa is projected to report earnings of $1.86 per share, which would represent year-over-year growth of 14.81%. Our most recent consensus estimate is calling for quarterly revenue of $7.58 billion, up 15.63% from the year-ago period.
For the full year, our Zacks Consensus Estimates are projecting earnings of $7.40 per share and revenue of $29.08 billion, which would represent changes of +25.21% and +20.63%, respectively, from the prior year.
It is also important to note the recent changes to analyst estimates for Visa. These revisions typically reflect the latest short-term business trends, which can change frequently. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.
Based on our research, we believe these estimate revisions are directly related to near-team stock moves. 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. Within the past 30 days, our consensus EPS projection has moved 0.5% higher. Visa is currently a Zacks Rank #2 (Buy).
Investors should also note Visa's current valuation metrics, including its Forward P/E ratio of 27.2. This represents a premium compared to its industry's average Forward P/E of 15.99.
Investors should also note that V has a PEG ratio of 1.63 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. Financial Transaction Services stocks are, on average, holding a PEG ratio of 1.04 based on yesterday's closing prices.
The Financial Transaction Services industry is part of the Business Services sector. This group has a Zacks Industry Rank of 162, putting it in the bottom 36% 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.
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