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Visa (V) Gains As Market Dips: What You Should Know

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Visa (V - Free Report) closed the most recent trading day at $213.32, moving +0.13% from the previous trading session. This move outpaced the S&P 500's daily loss of 0.61%. Meanwhile, the Dow lost 0.42%, and the Nasdaq, a tech-heavy index, added 0.17%.

Heading into today, shares of the global payments processor had gained 1.45% over the past month, lagging the Business Services sector's gain of 2.12% and outpacing the S&P 500's gain of 0.89% in that time.

Visa will be looking to display strength as it nears its next earnings release. In that report, analysts expect Visa to post earnings of $2 per share. This would mark year-over-year growth of 10.5%. Meanwhile, our latest consensus estimate is calling for revenue of $7.68 billion, up 8.76% from the prior-year quarter.

V's full-year Zacks Consensus Estimates are calling for earnings of $8.29 per share and revenue of $31.9 billion. These results would represent year-over-year changes of +10.53% and +8.82%, respectively.

Investors might also notice recent changes to analyst estimates for Visa. These revisions help to show the ever-changing nature of near-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. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.

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. The Zacks Consensus EPS estimate remained stagnant within the past month. Visa currently has a Zacks Rank of #3 (Hold).

Investors should also note Visa's current valuation metrics, including its Forward P/E ratio of 25.69. Its industry sports an average Forward P/E of 14.14, so we one might conclude that Visa is trading at a premium comparatively.

Meanwhile, V's PEG ratio is currently 1.71. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. The Financial Transaction Services was holding an average PEG ratio of 0.91 at yesterday's closing price.

The Financial Transaction Services industry is part of the Business Services sector. This group has a Zacks Industry Rank of 152, putting it in the bottom 40% 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.

Be sure to follow all of these stock-moving metrics, and many more, on Zacks.com.


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