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MasterCard (MA) Outpaces Stock Market Gains: What You Should Know

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MasterCard (MA - Free Report) closed at $191.29 in the latest trading session, marking a +0.81% move from the prior day. This change outpaced the S&P 500's 0.7% gain on the day. Elsewhere, the Dow gained 0.42%, while the tech-heavy Nasdaq added 1.26%.

Prior to today's trading, shares of the processor of debit and credit card payments had lost 6.52% over the past month. This has lagged the Business Services sector's loss of 6.19% and the S&P 500's loss of 6.13% in that time.

Wall Street will be looking for positivity from MA as it approaches its next earnings report date. This is expected to be January 31, 2019. In that report, analysts expect MA to post earnings of $1.53 per share. This would mark year-over-year growth of 34.21%. Our most recent consensus estimate is calling for quarterly revenue of $3.79 billion, up 14.44% from the year-ago period.

Any recent changes to analyst estimates for MA should also be noted by investors. These revisions typically reflect the latest short-term business trends, which can change frequently. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.

Our research shows that these estimate changes are directly correlated with near-term stock prices. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.

The Zacks Rank system ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. The Zacks Consensus EPS estimate has moved 0.22% higher within the past month. MA currently has a Zacks Rank of #3 (Hold).

Investors should also note MA's current valuation metrics, including its Forward P/E ratio of 25.14. Its industry sports an average Forward P/E of 16.69, so we one might conclude that MA is trading at a premium comparatively.

Also, we should mention that MA has a PEG ratio of 1.39. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. MA's industry had an average PEG ratio of 1.28 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 96, putting it in the top 38% of all 250+ industries.

The Zacks Industry Rank includes is listed in order from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

To follow MA in the coming trading sessions, be sure to utilize Zacks.com.


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