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Buy 3 AI-Powered Giant Financial Transaction Services Stocks for 2H25
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Key Takeaways
Visa, Mastercard, and PayPal are using AI to enhance fraud detection, security, and customer experience.
V is embedding AI into over 100 products and invested $3.5B in a data platform to block $40B in annual fraud.
MA and PYPL are leveraging AI to drive payment efficiency, personalization, and operational performance.
The financial transaction services industry is expected to benefit from expanding transaction volumes resulting from the widespread adoption of digital means. The ongoing digitization movement across the globe is a major catalyst for this industry.
In addition to global digitization, the financial transaction services providers are expected to benefit from the rising adoption of contactless and cross-border payments, resilient consumer spending and strategic growth through mergers and acquisitions (M&A). Advancements in technologies like BNPL, biometrics and cryptocurrency are also expanding market reach and boosting revenues.
At this stage, we recommend three financial transaction services bigwigs with a favorable Zacks Rank. These companies are increasingly adopting high-end artificial intelligence (AI) technologies to provide a secure, top-quality service.
Resilient consumer spending has benefited providers of financial transaction services, contributing to increased transaction volumes and higher revenues. The continued growth of e-commerce, supported by broader Internet penetration and widespread smartphone use, will likely sustain strong consumer spending. Moreover, continued technology investments and expected interest rate cuts support long-term growth and innovation across the space.
The Zacks-defined Financial Transaction Services industry is currently within the top 18% of the Zacks Industry Rank. Since the Internet Software industry is ranked in the top half of Zacks Ranked Industries, we expect it to outperform the market over the next three to six months.
The chart below shows the price performance of our three picks in the past three months.
Image Source: Zacks Investment Research
Visa Inc.
Visa’s strong market position is underpinned by consistent volume-driven growth, acquisitions and technological leadership in digital payments. Expansion in cross-border volumes, rising digital transactions, and investments in AI and stablecoin infrastructure enhance V’s prospects.
Visa’s strategic acquisitions and alliances are fostering long-term growth and consistently driving revenues. V is fueled by continued increases in payments, cross-border volumes and sustained investments in technology, and is witnessing significant profit growth.
The ongoing shift to digital payments is advantageous for Visa, with strong domestic volumes supporting its overall performance. With fraud cases on the rise and AI adoption increasing, V’s services are in high demand. V has embedded AI and generative AI into over 100 products, primarily for fraud prevention and cybersecurity.
Visa has invested $3.5 billion in rebuilding its data platform. V’s technology helps prevent $40 billion in fraud attempts annually. Through strategic diversification, innovation, and AI-driven security, V is well-positioned for long-term growth.
Visa has an expected revenue and earnings growth rate of 10.2% and 12.9%, respectively, for the current year (ending September 2025). The Zacks Consensus Estimate for current-year earnings has improved 0.1% in the last 30 days.
Mastercard Inc.
Mastercard’s acquisitions are helping it to grow addressable markets and drive new revenue streams. We expect MA’s net revenue to rise 13% year over year in 2025. The accelerated adoption of digital and contactless solutions is providing an opportunity for MA’s business to expedite its shift to the digital mode. Strong cash flow supports its growth initiatives.
Mastercard is aggressively adopting AI technologies to enhance security and customer experiences. MA is using AI in five different aspects of its operations. First, fraud detection and prevention. Second, optimize the payment processing services.
Third, customer experience personalization. Fourth, deeper analysis of customer behavior using predictive AI analytics tools. Five, use of high-end AI technologies to enhance merchant services.
Mastercard has an expected revenue and earnings growth rate of 13.1% and 9.7%, respectively, for the current year. The Zacks Consensus Estimate for current-year earnings has improved 0.1% in the last seven days.
PayPal Holdings Inc.
PayPal Holdings is benefiting from robust growth in total payment volume. Strengthening customer engagement on PYPL’s platform is a major positive. Venmo’s improving monetization efforts and rising adoption rate across various platforms are aiding total active accounts growth.
The solid momentum of core peer-to-peer and PayPal Checkout experiences is a tailwind. Well-performing merchant services are also a positive. Strengthening presence in both the United States and international markets is contributing well. Accelerating transaction revenues of PYPL are likely to continue driving the top line.
PayPal is significantly leveraging AI across its platform to enhance fraud detection, personalized experience and operational efficiency. PYPL’s agentic AI ecosystem enables the company to simplify and streamline integration across all its services.
PayPal Holdings has an expected revenue and earnings growth rate of 3.7% and 8%, respectively, for the current year. The Zacks Consensus Estimate for the current-year earnings has improved 2.2% in the last 30 days.
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Buy 3 AI-Powered Giant Financial Transaction Services Stocks for 2H25
Key Takeaways
The financial transaction services industry is expected to benefit from expanding transaction volumes resulting from the widespread adoption of digital means. The ongoing digitization movement across the globe is a major catalyst for this industry.
In addition to global digitization, the financial transaction services providers are expected to benefit from the rising adoption of contactless and cross-border payments, resilient consumer spending and strategic growth through mergers and acquisitions (M&A). Advancements in technologies like BNPL, biometrics and cryptocurrency are also expanding market reach and boosting revenues.
At this stage, we recommend three financial transaction services bigwigs with a favorable Zacks Rank. These companies are increasingly adopting high-end artificial intelligence (AI) technologies to provide a secure, top-quality service.
These companies are: Visa Inc. (V - Free Report) , Mastercard Inc. (MA - Free Report) and PayPal Holdings Inc. (PYPL - Free Report) . Each of our picks currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Financial Transaction Services Industry Thriving
Resilient consumer spending has benefited providers of financial transaction services, contributing to increased transaction volumes and higher revenues. The continued growth of e-commerce, supported by broader Internet penetration and widespread smartphone use, will likely sustain strong consumer spending. Moreover, continued technology investments and expected interest rate cuts support long-term growth and innovation across the space.
The Zacks-defined Financial Transaction Services industry is currently within the top 18% of the Zacks Industry Rank. Since the Internet Software industry is ranked in the top half of Zacks Ranked Industries, we expect it to outperform the market over the next three to six months.
The chart below shows the price performance of our three picks in the past three months.
Image Source: Zacks Investment Research
Visa Inc.
Visa’s strong market position is underpinned by consistent volume-driven growth, acquisitions and technological leadership in digital payments. Expansion in cross-border volumes, rising digital transactions, and investments in AI and stablecoin infrastructure enhance V’s prospects.
Visa’s strategic acquisitions and alliances are fostering long-term growth and consistently driving revenues. V is fueled by continued increases in payments, cross-border volumes and sustained investments in technology, and is witnessing significant profit growth.
The ongoing shift to digital payments is advantageous for Visa, with strong domestic volumes supporting its overall performance. With fraud cases on the rise and AI adoption increasing, V’s services are in high demand. V has embedded AI and generative AI into over 100 products, primarily for fraud prevention and cybersecurity.
Visa has invested $3.5 billion in rebuilding its data platform. V’s technology helps prevent $40 billion in fraud attempts annually. Through strategic diversification, innovation, and AI-driven security, V is well-positioned for long-term growth.
Visa has an expected revenue and earnings growth rate of 10.2% and 12.9%, respectively, for the current year (ending September 2025). The Zacks Consensus Estimate for current-year earnings has improved 0.1% in the last 30 days.
Mastercard Inc.
Mastercard’s acquisitions are helping it to grow addressable markets and drive new revenue streams. We expect MA’s net revenue to rise 13% year over year in 2025. The accelerated adoption of digital and contactless solutions is providing an opportunity for MA’s business to expedite its shift to the digital mode. Strong cash flow supports its growth initiatives.
Mastercard is aggressively adopting AI technologies to enhance security and customer experiences. MA is using AI in five different aspects of its operations. First, fraud detection and prevention. Second, optimize the payment processing services.
Third, customer experience personalization. Fourth, deeper analysis of customer behavior using predictive AI analytics tools. Five, use of high-end AI technologies to enhance merchant services.
Mastercard has an expected revenue and earnings growth rate of 13.1% and 9.7%, respectively, for the current year. The Zacks Consensus Estimate for current-year earnings has improved 0.1% in the last seven days.
PayPal Holdings Inc.
PayPal Holdings is benefiting from robust growth in total payment volume. Strengthening customer engagement on PYPL’s platform is a major positive. Venmo’s improving monetization efforts and rising adoption rate across various platforms are aiding total active accounts growth.
The solid momentum of core peer-to-peer and PayPal Checkout experiences is a tailwind. Well-performing merchant services are also a positive. Strengthening presence in both the United States and international markets is contributing well. Accelerating transaction revenues of PYPL are likely to continue driving the top line.
PayPal is significantly leveraging AI across its platform to enhance fraud detection, personalized experience and operational efficiency. PYPL’s agentic AI ecosystem enables the company to simplify and streamline integration across all its services.
PayPal Holdings has an expected revenue and earnings growth rate of 3.7% and 8%, respectively, for the current year. The Zacks Consensus Estimate for the current-year earnings has improved 2.2% in the last 30 days.