|Bid||0.00 x 900|
|Ask||0.00 x 1000|
|Day's Range||179.14 - 181.84|
|52 Week Range||121.60 - 181.84|
|Beta (3Y Monthly)||0.83|
|PE Ratio (TTM)||37.03|
|Earnings Date||Jul 23, 2019|
|Forward Dividend & Yield||1.00 (0.55%)|
|1y Target Est||191.22|
Amid all the talk of antitrust, government regulation and cryptocurrency plans, it might be nice for Big Tech just to focus on earnings this week — unless they are bad, of course.
As Facebook Inc. swims in criticism over its new efforts in cryptocurrency, the stalwarts of payments continue to thrive. Visa Inc. shares hit a new all-time high last week, and the card company will be looking to show that it remains on the cutting edge of digital payments when it reports earnings next Tuesday afternoon.
As Visa, Inc.’s (V) July 23 earnings release approaches, the stock is seeing explosive growth. It gained almost 36% year-to-date, double the S&P 500’s 18% increase. As the number of non-cash payments is only expected to rise, analysts and financial bloggers are saying V is in it for the long haul. Not to mention Jefferies analyst, Trevor Williams, initiated his coverage of the stock with a Buy rating and set his price target to $210 on July 18, suggesting 17% upside potential. Is this enough to convince investors to buy Visa ahead of earnings? Expectations for Q3According to consensus estimates, the company should see quarterly revenue reach $5.7 billion, a 9% gain from the prior-year quarter. Growth for client incentives is expected to fall within the range of 22% to 23% as a percentage of gross revenues. It’s predicted that Q3 will have the highest exchange rate drag for the year at 200 basis points on net revenue and 300 basis points on EPS. However, by Q4, management believes this figure will drop to 100 basis points for net revenue and 150 for EPS. For the rest of fiscal year 2019, the company raised its expectations for EPS growth to be the high end of mid-teens on an adjusted non-GAAP nominal dollar basis and the low 20s on GAAP nominal dollar basis. Visa Looks Strong Long-TermConsumers are relying more and more on non-cash payments as a more convenient way to pay. Over the last few years, non-cash transaction volume grew by 10% plus clip. Experts predict that this trend will continue. While cash payments are still common in developing countries, credit card usage is expected to rise as these countries adapt to the digital age. Global non-cash payments volume is expected to increase by at least 10%. A 20% plus growth rate is forecasted for emerging market non-cash payments volume. Visa has a majority stake in the market, with a $394 billion market cap compared to Mastercard, Inc.’s (MA) $285 billion. It controls 50% of the world’s card payments market excluding China. Its volume, transaction and revenue growth rates are expected to persist as the card payments market continues to develop. Business Model Expansion On June 25, it was announced that V is set to acquire Rambus, Inc.’s (RMBS) token services and ticketing businesses. The technology gained from this acquisition should help Visa facilitate safer and more secure payments across all of its global commerce products. SVP, global head of payment products and platforms, TS Anil said, “Facilitating safer, more secure digital transactions is core to Visa’s brand promise and central to growing electronic payments for everyone, everywhere. As the way people and businesses pay and get paid continues to evolve, the addition of Rambus’ technology will allow us to deliver greater security beyond the card to support more transactions, payments systems and participants.” In Q3, Visa continued to expand its business model with the addition of several new product offerings. In June, the company launched new installment capabilities for cardholders. Issuers and merchants can now offer installment payment options through a buyer’s Visa card, simplifying the installment process for both buyers and sellers. In that same month, Visa released its B2B payment network, allowing financial institutions to process high-value corporate cross-border payments much more quickly. The company also announced it signed up Coinbase, a brokerage for trading Bitcoin, and partnered with the Libra Association, the governing body for Facebook's (FB) new digital currency. Potential Valuation Problems Some investors are concerned that even with V’s strong long-term growth potential, its valuation is too high. The stock’s forward P/E ratio is 33.37, significantly higher than the industry’s average 24.66 forward P/E. Top financial blogger, Luke Lango, writes, “Visa’s EPS growth should run around 10%-15% over the next several years. At that growth rate, Visa’s EPS will settle around $11 by 2025. Based on a historically average 25 forward multiple and 10% discount rate, that equates to a fundamentally supported 2019 price target for Visa stock of roughly $170. Thus, at $180 mid-way through 2019, Visa stock seems slightly overvalued.” What are the Analysts Saying?Deutsche Bank analyst, Bryan Keane, reiterated his Buy rating while raising his price target from $177 to $225 on July 11. He believes share prices could jump by as much as 26% over the next twelve months. “Although the payment networks have a long runway to benefit from the secular growth of card-based transactions, the expanding market share opportunity into new account-to-account payment flows and non-interchange based revenue models are being underappreciated,” he said. Keane has an 80% success rate and a 22% average return per rating. Another five-star analyst from Baird, David Koning, expressed his confidence in V’s ability to sustain its growth rates. On July 19, he maintained his Buy rated and raised his price target from $182 to $196, indicating 9% upside potential. The analyst boasts an impressive 85% success rate as well as a 21% average return per rating. The Final VerdictDespite an expensive valuation, the Street remains bullish on Visa. The stock has a ‘Strong Buy’ analyst consensus, with 14 Buy ratings vs 1 Hold received over the last three months. It has a $192 average price target, suggesting 7% upside potential.
The investing public should get an idea about the performance of the payments industry as the earnings report on Visa (NYSE:V) comes out. The world's largest payments processor will report its third-quarter earnings on Tuesday, July 23rd after the bell. However, expectations will probably run as high as Visa stock.Source: Shutterstock As of last year, Visa controlled about 61.5% of the payment network market in the United States. Consequently, the stock has moved steadily throughout the year. However, given the valuation, the market appears to have fully priced in the market share and earnings growth of V stock. Earnings and Revenue Continue to RiseFor the quarter ending on June 30th, analysts predict Visa earnings of $1.32 per share. Should this hold, that will represent a 10% increase from the same quarter last year, when profits came in at $1.20 per share. Wall Street also projects revenues of $5.7 billion, 8.8% more than the $5.24 billion the company brought in during the third quarter of 2018.InvestorPlace - Stock Market News, Stock Advice & Trading Tips * 7 Stocks Top Investors Are Buying Now Visa stock has remained in a fortuitous position for some time. The demand for Visa's services continues to increase profits at double-digit rates as society becomes increasingly cashless. Visa Stock Is ExpensiveThose who hoped to buy on a dip have seen few opportunities. Visa stock fell along with the market, falling to a low of $121.60 per share on December 24th. Since then, it has moved steadily higher, climbing almost 50% since the Christmas Eve bottom. The current price of just over $180 per share comes very close to the all-time high on V stock.Unfortunately for new investors, the current price of Visa stock reflects this growth potential. The forward price-to-earnings ratio now exceeds 29. Wall Street believes that earnings will grow by 16.5% this year and 15.6% in 2020. Consequently, one can understand why V stock is not cheap.Visa stock appears expensive in more ways than one. Many at InvestorPlace seem to agree. Dana Blankenhorn says, "it's time to take profits." Luke Lango calls it a "long-term winner," but says it is "not worthy of paying $180 per share." Even V stock bull Tom Taulli admitted valuations and pressure to reduce fees could undermine the case for Visa.These double-digit growth rates have existed for some time. This has helped the company fund ten straight years of dividend increases. However, the payout now stands at $1 per year. This takes the yield to only around to only 0.55%. That does not compare well to the average dividend return for the S&P 500, which currently stands at just under 1.9%.In fairness, investors seem to get what they pay for in this industry. Mastercard (NYSE:MA) trades at a forward P/E ratio of 31, a bit above Visa's multiple. However, analysts believe MA will post higher profit growth numbers than Visa.Some investors might prefer paying about 14 times forward earnings for American Express (NYSE:AXP). However, AXP stock barely exceeds 10% on profit growth. One can say the same about Discover Financial (NYSE:DFS). DFS stock trades at 8.7x forward earnings. However, Wall Street believes profit growth will fall below 10% after this year. Should I Buy Visa Stock Before Earnings?Despite the success of the company, investors should probably avoid Visa stock going into earnings. Without question, Visa runs the largest payment network. Moreover, thanks to the growing popularity of e-commerce and cashless payment options, its massive size has not precluded double-digit profit growth.However, at more than 29 times forward earnings, the current Visa stock price fully reflects both its value and growth. It will also account for the fact that the company will more than likely beat earnings. * 10 Tech Stocks That Are Still Worth Your Time (And Money) For those determined to invest in this industry, I would choose Visa stock, but not right now. I would urge investors to wait for a correction or a bear market for the S&P 500. As long as the payments industry stays in a growth mode, only a significant decline in the overall market will offer the opportunity to buy V stock at a reasonable price.As of this writing, Will Healy did not hold a position in any of the aforementioned stocks. You can follow Will on Twitter at @HealyWriting. More From InvestorPlace * 2 Toxic Pot Stocks You Should Avoid * 10 Tech Stocks That Are Still Worth Your Time (And Money) * 7 Marijuana Stocks With Critical Levels to Watch * 7 of the Best Smart-Beta ETFs to Target Right Now The post The Bill for Visa Stock Is Too High Ahead of Earnings appeared first on InvestorPlace.
American Express (AXP) reported its second-quarter earnings results on Friday before the market opened. Its EPS beat analysts’ consensus estimate.
It's rare to find bipartisanship in today's polarized environment in Washington DC. But there is one issue that seems to unite the factions: the distrust of Facebook (NASDAQ:FB), and that's not good news for Facebook stock.Source: Shutterstock That's ironic. Keep in mind that FB continues to be quite popular with its users. The company has also been aggressive when it comes to hiring and providing juicy salaries. In the first quarter, its headcount grew by 36% on a year-over-year basis to 37,773. * 10 Tech Stocks That Are Still Worth Your Time (And Money) But such things don't really matter much. Over the years, FB has been careless with users' data and privacy. And this has impacted views on FB within DC. After all, the company recently agreed to a $5 billion settlement with the Federal Trade Commission regarding its privacy practices.InvestorPlace - Stock Market News, Stock Advice & Trading TipsYet this week's testimony regarding FB's planned launch of the Libra cryptocurrency -- which has the backing of Visa (NYSE:V), MasterCard (NYSE:MA) and PayPal (NASDAQ:PYPL) -- is perhaps the most interesting evidence of the distrust towards FB from Washington.Here's what Democrat Congressman,Brad Sherman had to say: "The most innovative thing that happened this century is when Osama bin Laden came up with the innovative idea of flying two airplanes into towers. That's the most consequential innovation, although this may do more to endanger America than even that."Yikes! Oh, and he referred to CEO Mark Zuckerberg as "Zuckbucks."In the meantime, there was criticism from the other side of the aisle. For example, Federal Reserve Chairman Jerome Powell, Treasury Secretary Steven Mnuchin and President Trump have expressed concerns about Libra. FB Stock and LibraDavid Marcus, who heads up the Libra project for FB, tried his best to handle the questions. He was actually fairly reasonable and understanding. Keep in mind that Marcus said that the cryptocurrency would not be a vehicle for trading or for banking services. He added that it would also have a great deal of transparency, helping to reduce its use in illicit activities.According to InvestorPlace.com columnist Dana Blankenhorn: "The difference is that, while banks today have to police compliance at the teller's window, so to speak, Libra will make its blockchain available to police. Facebook will control neither the network, the currency, nor the reserve backing it. Its Calibra subsidiary will just be running digital wallets."Marcus also mentioned that FB would not move forward with Libra until regulators are satisfied with it. In other words, he did demonstrate some finesse.It's difficult to predict what may ultimately happen to Libra. But given the pushback in Congress, I think the future of Libra does look dicey. Interestingly enough, the value of bitcoin has plunged recently, going from $13,000 to $9,800. The decline indicates that investors are skeptical about Libra's future. The Bottom Line on Facebook StockThe success or failure of Libra probably does not mean a lot to FB and FB stock. Rather, the hearings point to the ominous fact that FB does face serious political headwinds.FB's current problems with Washington look similar to those of Microsoft (NASDAQ:MSFT) back in the 1990s, when the company came under pressure from antitrust regulators. In fact, the parallels are eerie. Both Bill Gates and Zuckerberg started their technology companies while at Harvard and subsequently cashed in on huge opportunities. Essentially, they ruthlessly created extremely powerful platforms and ecosystems which would be nearly impossible to destroy.MSFT become an easy target. There were many companies that wanted to take it down to even the tech playing field. As a result, MSFT had to focus more and more time and resources on battling regulators. This ultimately led to the company losing its momentum and dominance, until the past couple years.I could easily envision FB suffering a similar fate. The company has become a convenient punching bag - and for good reason.I'm not implying that things will suddenly come undone for FB. For the most part, the company appears to be running on all cylinders. But in the years to come, it would not be surprising to see FB face more problems, making it tougher to be bullish about the long-term outlook of FB stock.Tom Taulli is the author of the upcoming book, Artificial Intelligence Basics: A Non-Technical Introduction. Follow him on Twitter at @ttaulli. As of this writing, he did not hold a position in any of the aforementioned securities. More From InvestorPlace * 2 Toxic Pot Stocks You Should Avoid * 10 Tech Stocks That Are Still Worth Your Time (And Money) * 7 Marijuana Stocks With Critical Levels to Watch * 7 of the Best Smart-Beta ETFs to Target Right Now The post Facebook Stock Looks Poised to Face Tough Regulatory Headwinds appeared first on InvestorPlace.
The serial entrepreneur sounds off on the negative impact he says the tech sector is having on the Bay Area's quality of life.
Hardware becoming software is one of the key trends of this decade. As Apple (NASDAQ:AAPL) prepares to refresh its product line for the fall of 2019, it is selling its software as a lifestyle.Source: Shutterstock The key product launch investors need to consider is the Apple Card, the company's entry into finance.While Facebook (NASDAQ:FB) wants to create its own money and replace the current Visa (NYSE:V)-dominated payment infrastructure with something cheaper, Apple Card is a gloss on MasterCard (NYSE:MA), with personal finance delivered through an app and integration with existing wireless payment technology.InvestorPlace - Stock Market News, Stock Advice & Trading TipsApple is also throwing money at original content, hoping to overwhelm Spotify (NASDAQ:SPOT) in podcasts and Netflix (NASDAQ:NFLX) in streaming entertainment. * 7 Stocks Top Investors Are Buying Now Apple's strategy is coming into focus. It's a lifestyle and an indenture. It's a walled garden where, in exchange for promises of privacy, Apple controls everything you have, including your cash flow. The Biggest iOS LaunchApple's biggest product launch is now going through its final beta test, iOS 12.4 beta 7. Its successor, iOS 13, was announced at the June Worldwide Developer's Conference.The key new feature supported by 12.4 is the Apple Card, on which Goldman Sachs (NYSE:GS) estimates it has spent nearly $275 million, transforming itself from an investment bank into a consumer bank. The card itself is designed around the app, with daily cash rewards and full integration with the Apple Wallet to track spending.The card is thus meant to change behavior, which now favors physical debit cards for most transactions. The potential bonanza here is enormous. People who pay off their cards spend an average of $1,154 with them each month, and the average user carries $6,354 of credit card debt. Goldman expects to offer $1,000 in credit to those with credit scores as low as 600, and charge Apple Card customers interest rates of 13%-24% on balances. Apple's Ho-Hum HardwareWith the next iPhone already being called a clunker, Apple has to extract more from software and services to maintain last year's 15% growth rate, with 22% of revenue hitting the net income line.The iPhone 11 design itself looks like a greatest hits album from previous iterations. Its main improvement is a bigger battery. The same is true for the latest MacBook, which only received minor tweaks on existing designs.But the hardware is the center of a software ecosystem that brings Apple profit from every corner of a customer's life. Software and services are more profitable than hardware.This extends to the Apple Watch. Given how many stores had the watch at clearance prices this month, including the Apple Watch 4, an Apple Watch 5 can't be far off. But the hardware isn't likely to change much. It will just be capable of running more software, especially health software. Health will follow cash into the Apple profit column.Critics worry the emphasis on service revenue will compromise the user experience. But people who believe in Apple tend to go all-in. The most important point about the iPhone's market share is its stability. They have half of the U.S. market and over one-fifth of the global market. The Bottom LineAn Android is a phone, a utility that offers unlimited choice. An iPhone is a lover, seducing and then demanding increasing loyalty.Once you're in the Apple ecosystem, the company wants to make it a lifestyle, handling your money, your entertainment, even your health.That's CEO Tim Cook's bet, that Apple products can be more than phones or watches or PCs, but a lifestyle for those seduced by its design and brand promise.Dana Blankenhorn is a financial and technology journalist. He is the author of a new environmental story, Bridget O'Flynn and the Bear, available now at the Amazon Kindle store. Write him at email@example.com or follow him on Twitter at @danablankenhorn. As of this writing he owned shares in AAPL. More From InvestorPlace * 2 Toxic Pot Stocks You Should Avoid * 7 Stocks Top Investors Are Buying Now * The 10 Best Cryptocurrencies to Keep on Your Radar * 7 Marijuana Penny Stocks That Could Triple (But You Won't Make Money) The post AAPL Stock: Apple Software Becomes Lifestyle appeared first on InvestorPlace.
Anything with a high P/E must have a large total addressable market, the ability to scale up its business and a wide 'moat.' One stock that fits the bill: Mastercard.
(Bloomberg) -- After surviving a two-day battering on Capitol Hill, now comes the hard part for Facebook Inc.: turning its 12-page white paper into a legitimate cryptocurrency in the face of deep skepticism from central banks, regulators and politicians of all stripes.David Marcus, the Facebook executive leading its blockchain efforts, spent much of his time at congressional hearings this week apologizing for the past mistakes of his employer. When he wasn’t defending Facebook, Marcus tried to explain how Libra -- the proposed currency -- would actually work. He said repeatedly that he wants to work with Congress and regulators to get Libra off the ground, and has no plans to debut the new currency before regulatory bodies are satisfied.“Nothing is launched and nothing will launch until all concerns are addressed,” Marcus said Wednesday. He reiterated a version of that promise over and over during more than six hours of testimony in Washington this week before members of the House Financial Services Committee and the Senate Banking Committee.Still, large existential questions remain about the project, including who or what will be regulating Libra. Marcus said it was not his place to decide who Libra’s regulator would be, though he appeared to reject the idea that Facebook should be treated like a bank. Marcus denied that the company would offer banking services, and also argued that he doesn’t believe Libra is a security that should fall under the Securities and Exchange Commission.Those issues are unlikely to be resolved soon, since the Libra currency doesn’t yet exist; and the Libra Association, the governing body made up of Facebook and other institutional partners that will be charged with overseeing the currency, has yet to be fully formed.The 28 companies that currently make up the association have not yet drafted a charter, and still must appoint a board and a general manager. Libra will also face additional concerns from international regulators and lawmakers, which could further delay its progress.In the meantime, two people familiar with Facebook’s cryptocurrency plans say the hearings did not give the company any immediate reason to change course.The people, who asked not to be identified because the planning is private, also said that Facebook’s team hoped that other members of the Libra Association would be more active in conversations with the media and with regulators. Of the group’s 28 “founding” members, including PayPal Holdings Inc., Visa Inc. and Uber Technologies Inc., Facebook is the only one that testified before Congress, and is by far the company most closely associated with the effort.Over the course of the hearings, a few central questions emerged. Here’s what we know now about how Facebook and the Libra Association will try to answer them in the coming months.1\. What is Libra, exactly?The coin’s legal classification remains murky, which could pose challenges for federal watchdogs eager to slide the token into the U.S.’s existing regulatory regime.Some observers have argued that Libra resembles a mutual fund or exchange-traded fund that is based on an index, an investment that would be regulated by the SEC. Labeling Libra a similar product could provide policy makers the hook they need to police the coin, while also giving regulators a mechanism to slow the project down as Facebook goes through a lengthy SEC approval process.At Wednesday’s hearing, Marcus insisted the coin is a just “payment tool” or maybe a commodity that shouldn’t be subject to the SEC’s rules.2\. Is Facebook getting into banking?Marcus went to great lengths in his Senate and House testimony to insist that the company was not. There won’t be bank accounts; holders of Libra won’t be earning interest; and Facebook won’t be taking deposits, he told lawmakers.“It’s like digital cash,” Marcus said. One reason Facebook wants to stay away from these activities is that they would require a federal banking charter. That would open the company up to much stricter oversight, likely by the Office of the Comptroller of the Currency and the Federal Reserve. The company would face many new, costly regulatory requirements like capital standards and stepped-up disclosures. It would also be subject to monitoring by government examiners.3\. Why is the Libra Association headquartered in Switzerland?This was a very popular question from members of both the House and Senate. Lawmakers raised concerns that Facebook set up the Libra Association in Switzerland to avoid U.S. regulations. Marcus said that was not the case, and said that the location of Libra’s headquarters had “nothing to do with us evading our responsibilities.”Marcus said that Switzerland offered Libra an “international platform” so that it would be recognized globally, and noted that Switzerland is home to other global institutions, like the World Trade Organization.4\. How will Facebook make money from this?In the short term, Marcus says Libra will improve Facebook’s advertising business by increasing the amount of commerce that happens through Facebook’s products. If more people have digital wallets, they may be more likely to make purchases through Facebook or its other properties, like Instagram or Messenger. That, Marcus says, makes Facebook’s ads more valuable because it gives marketers more incentive to reach users with money at their disposal.Marcus also said that it’s possible Facebook could one day offer financial services, including, potentially, loans, but that those products would be done through partnerships with an existing bank, allowing the company to avoid opening a bank of its own.5\. What, if anything, can Congress actually do to stop Libra?While both chambers of Congress are clearly concerned, whether or not they will pass any legislation that would affect the project is less clear. House Financial Services Committee Chairwoman Maxine Waters, a California Democrat, discussed a bill that would bar large tech platforms from being financial institutions -- possibly blocking Libra -- though it’s unclear how much support such a proposal would garner.Other lawmakers discussed creating a regulator just for digital currencies or using broader data privacy legislation to address Libra. But so far, there’s no consensus on a resolution. As Congress nears its August recess, it’s unlikely any of those issues will be addressed quickly.\--With assistance from Austin Weinstein, Ben Bain and Robert Schmidt.To contact the reporters on this story: Kurt Wagner in San Francisco at firstname.lastname@example.org;Julie Verhage in New York at email@example.comTo contact the editors responsible for this story: Jillian Ward at firstname.lastname@example.org, Anne VanderMey, John HarneyFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.
Visa Inc. today announced that on July 15, 2019, its Board of Directors declared a quarterly cash dividend of $0.25 per share of class A common stock , payable on September 3, 2019, to all holders of record as of August 16, 2019.
T. Rowe Price saw 14 of its U.S. stock mutual funds outperform the S&P; 500\. Are you invested in any of them?
While Facebook set the middle of 2020 as the Libra Cryptocurrency's launch date, many people think that the deadline might be too aggressive.
Yesterday, Facebook’s (FB) David Marcus, head of Facebook’s Calibra wallet, visited Capitol Hill to testify in front of the Senate Banking Committee.
On July 23, Visa (V) is scheduled to report its third-quarter earnings for the quarter ending June 30. Analysts expect Visa’s third-quarter revenues to be $5,699 million.
Considering the growing need for cloud-based applications and software, Accenture's (ACN) investment in this space should propel long-term growth.
Visa (NYSE:V) today announced it has acquired Payworks, a Munich-based provider of next-generation payment gateway software for the Point of Sale (POS). Visa will bring Payworks’ cloud-based solution for in-store payment processing together with its CyberSource digital payment management platform to create a fully integrated payment acceptance solution for merchants and acquirers.