Back to top

Image: Bigstock

Mastercard (MA) Ties Up to Ramp Up Travel Sector Growth in MENA

Read MoreHide Full Article

Mastercard Incorporated (MA - Free Report) recently joined forces with India’s rapidly growing travel website Musafir to introduce cutting-edge payment products and solutions for enhancing travel bookings across the Middle East and North Africa (MENA) region.

Shares of Mastercard gained 2.3% on May 27.

The innovative digital payment products, as a result of the partnership, basically aim to aid consumers and corporates. Musafir will utilize Mastercard’s innovative technology to launch these products. Thus, end-to-end payment flows will be digitized, paving the way for offering travel benefits to Musafir customers and the opportunity to avail of integrated travel expense management solutions by corporate clients.

The recent tie-up reinforces Mastercard’s sincere efforts to leverage insights, data analysis, and inventive digital solutions to ramp up the growth of the travel sector. MA has been pursuing alliances and investments to actively participate in the ongoing recovery of the travel and tourism sector, which previously bore the brunt of the COVID-19 induced restrictions (ranging from cross-border restrictions to constraints on people’s movement).

Musafir, sharing the mutual aim to accelerate the travel sector growth, seems to be the apt partner for complementing Mastercard’s endeavor. Teaming up with Musafir seems to be a prudent move by MA as the former remains one of the most well-known corporate travel management companies in the MENA region. Musafir’s launch of an all-in-one Business Travel Management solution, through which organizations can utilize automated approval workflows and travel policy compliance to manage travel, is a testament to its continuous efforts to ease travel and enhance customer experience.

The collaboration comes at an opportune time for Mastercard as well. The reason can be substantiated by the significant increase in travel likely to occur in 2022 resulting from easing of border restrictions, suppressed demand for travel, and gradual gaining of confidence in traveling. Per an analysis by Mastercard Economics Institute, if the pace at which flight bookings are presently taking place continues, an approximate figure of 115 million more passengers in Eastern Europe, Middle East and Africa will fly in 2022 compared to the 2021 level. The same source further raises optimism about the recovery of the tourism and travel sector by revealing that global leisure and business flight bookings have exceeded pre-pandemic levels.

The recent move reiterates one of Mastercard’s notable endeavors — to harness opportunities prevailing in the digital payments space of the MENA region. Several factors such as widespread adoption of digital services, increased Internet penetration, and higher usage of smartphones have continued to shape the market growth. Extending its enhanced payment solutions suite is expected to strengthen the presence of Mastercard in the rapidly digitizing MENA region.

Shares of Mastercard have gained 16.8% in the past six months against the industry’s decline of 0.8%. MA currently carries a Zacks Rank #3 (Hold).

Zacks Investment Research
Image Source: Zacks Investment Research

Stocks to Consider

Some better-ranked stocks in the Business Services services space include Huron Consulting Group Inc.  (HURN - Free Report) , Automatic Data Processing, Inc. (ADP - Free Report) and The Interpublic Group of Companies, Inc.  (IPG - Free Report) . While Huron Consulting currently flaunts a Zacks Rank #1 (Strong Buy), Automatic Data Processing and Interpublic Group carry a Zacks Rank of 2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

The bottom line of Huron Consulting outpaced estimates in each of the last four quarters, the average surprise being 29.97%. The Zacks Consensus Estimate for HURN’s 2022 earnings suggests an improvement of 22.6% from the year-ago reported figure. The same for revenues suggests year-over-year growth of 13.5%. The consensus mark for Huron Consulting’s 2022 earnings has moved 5.3% north in the past 30 days.

Automatic Data Processing’s earnings outpaced estimates in each of the trailing four quarters, the average surprise being 6.23%. The Zacks Consensus Estimate for ADP’s 2022 earnings suggests an improvement of 15.8% from the year-ago reported figure. The same for revenues suggests growth of 9.5%. The consensus mark for Automatic Data Processing’s 2022 earnings has moved 1.2% north in the past 30 days.

The bottom line of Interpublic Group outpaced estimates in each of the last four quarters, the average surprise being 26.03%. The Zacks Consensus Estimate for IPG’s 2022 earnings suggests an improvement of 4.6% from the year-ago reported figure. The same for revenues suggests growth of 11.4% from a year ago. The consensus mark for Interpublic Group’s 2022 earnings has moved 1.1% north in the past 30 days.

Huron Consulting stock has gained 37.3% in the past six months. Meanwhile, shares of Automatic Data Processing and Interpublic Group have lost 1% and 2.3%, respectively, in the same time frame.

Published in