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Buy Visa Stock on Impressive Q2 Earnings and Strong Business Visibility
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Key Takeaways
Visa reported Q2 EPS of $2.98 and revenue of $10.17B, beating consensus estimates on both metrics.
Payments volume rose 8% and transactions grew 10%, with all business segments topping estimates.
Visa is expanding stablecoin settlements and embedding AI in over 100 products to boost growth and security.
The global financial transaction services giant Visa Inc. (V - Free Report) reported solid quarterly adjusted earnings of $2.98 per share, beating the Zacks Consensus Estimate of $2.86. This compares to earnings of $2.42 per share a year ago. Quarterly revenues came in at $10.17 billion, surpassing the Zacks Consensus Estimate by 3.11%. Visa benefitted from strong consumer sentiment across its line of business.
In the last reported quarter, revenues of all its business segments were better than the Zacks Consensus Estimates. Visa's payments volume increased 8% and processed transactions grew 10%. Total payment volumes were $3,618.00 billion versus the consensus mark of $3,583.74 billion. Total transactions came in at 65.44 billion versus the consensus estimate of 64.47 billion.
Business Diversifications
CEO Ryan McInerney said, “Looking ahead, our continued focus on innovation and product development in dynamic areas like AI and stablecoins is helping to shape the future of commerce while delivering sustainable, long-term value for our shareholders.”
Visa’s ongoing shift to digital payments is advantageous, with strong domestic volumes supporting its overall performance. V is taking a significant step toward modernizing cross-border money movement.
In a move aimed at enhancing the efficiency of global transactions, V is expanding its stablecoin settlement capabilities to the high-performing Solana and Ethereum blockchain. This expansion of V includes collaboration with prominent merchant acquirers Worldpay and Nuvei, marking a pivotal development in the world of digital payments.
On July 18, President Donald Trump signed the GENIUS Act (Guiding and Establishing National Innovation for US Stablecoins) seeking to regulate the stablecoin market of the nation. Stablecoins are digital assets that are built to maintain a stable value relative to a “stable” asset like the US dollar.
Various global retail behemoths are considering launching their own stablecoins to reduce dependence on traditional payment networks like plastic money. Emphasis on stablecoins is an effective diversification strategy by Visa to stay ahead of its competitors like Mastercard Inc. (MA - Free Report) , PayPal Holdings Inc. (PYPL - Free Report) and The Western Union Co. (WU - Free Report) .
Extensive AI Applications
Visa’s expansion in cross-border volumes, rising digital transactions, and investments in artificial intelligence (AI) has significantly enhanced its prospects. V is fueled by continued increases in payments, cross-border volumes and sustained investments in technology, and is witnessing solid profit growth.
With fraud cases on the rise and AI adoption increasing, V’s services are in high demand. Visa 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 annually in fraud attempts. Through strategic diversification, innovation, and AI-driven security, Visa is well-positioned for long-term growth.
Solid Earnings Estimate Revisions for V Stock
For fiscal 2025 (ending September 2025), the Zacks Consensus Estimate currently shows revenues of $39.63 billion, suggesting an improvement of 10.3% year over year and earnings per share of $11.37, indicating an increase of 13.1% year over year. The Zacks Consensus Estimate for the current year has improved 0.1% in the last 30 days.
For fiscal 2026 (ending September 2026), the Zacks Consensus Estimate currently shows revenues of $43.88 billion, suggesting an improvement of 10.7% year over year and earnings per share of $12.81, indicating an increase of 12.6% year over year. The Zacks Consensus Estimate for next year has improved 0.4% in the last 30 days.
Visa currently has a long-term (3-5 years) EPS growth rate of 13%, above the S&P 500’s long-term EPS growth rate of 12.6%.
Image Source: Zacks Investment Research
Attractive Short-Term Price Upside for V Shares
The short-term average price target of brokerage firms for the stock represents an increase of 11.3% from the last closing price of $351.29. The brokerage target price is currently in the range of $425-$305. This indicates a maximum upside of 21% and a downside of 13.2%.
Image Source: Zacks Investment Research
Investment Thesis for V Shares
Year to date, shares of Visa outperformed the broad-market index — the S&P 500. However, the stock significantly underperformed the S&P 500 in the past three months. Visa currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
The recent dip in stock price is a good opportunity to invest in this stock. Visa’s extensive AI thrust and effective business diversification will generate more value in the long term.
The chart below shows the price performance of V is the past three months.
Image Source: Zacks Investment Research
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Buy Visa Stock on Impressive Q2 Earnings and Strong Business Visibility
Key Takeaways
The global financial transaction services giant Visa Inc. (V - Free Report) reported solid quarterly adjusted earnings of $2.98 per share, beating the Zacks Consensus Estimate of $2.86. This compares to earnings of $2.42 per share a year ago. Quarterly revenues came in at $10.17 billion, surpassing the Zacks Consensus Estimate by 3.11%. Visa benefitted from strong consumer sentiment across its line of business.
In the last reported quarter, revenues of all its business segments were better than the Zacks Consensus Estimates. Visa's payments volume increased 8% and processed transactions grew 10%. Total payment volumes were $3,618.00 billion versus the consensus mark of $3,583.74 billion. Total transactions came in at 65.44 billion versus the consensus estimate of 64.47 billion.
Business Diversifications
CEO Ryan McInerney said, “Looking ahead, our continued focus on innovation and product development in dynamic areas like AI and stablecoins is helping to shape the future of commerce while delivering sustainable, long-term value for our shareholders.”
Visa’s ongoing shift to digital payments is advantageous, with strong domestic volumes supporting its overall performance. V is taking a significant step toward modernizing cross-border money movement.
In a move aimed at enhancing the efficiency of global transactions, V is expanding its stablecoin settlement capabilities to the high-performing Solana and Ethereum blockchain. This expansion of V includes collaboration with prominent merchant acquirers Worldpay and Nuvei, marking a pivotal development in the world of digital payments.
On July 18, President Donald Trump signed the GENIUS Act (Guiding and Establishing National Innovation for US Stablecoins) seeking to regulate the stablecoin market of the nation. Stablecoins are digital assets that are built to maintain a stable value relative to a “stable” asset like the US dollar.
Various global retail behemoths are considering launching their own stablecoins to reduce dependence on traditional payment networks like plastic money. Emphasis on stablecoins is an effective diversification strategy by Visa to stay ahead of its competitors like Mastercard Inc. (MA - Free Report) , PayPal Holdings Inc. (PYPL - Free Report) and The Western Union Co. (WU - Free Report) .
Extensive AI Applications
Visa’s expansion in cross-border volumes, rising digital transactions, and investments in artificial intelligence (AI) has significantly enhanced its prospects. V is fueled by continued increases in payments, cross-border volumes and sustained investments in technology, and is witnessing solid profit growth.
With fraud cases on the rise and AI adoption increasing, V’s services are in high demand. Visa 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 annually in fraud attempts. Through strategic diversification, innovation, and AI-driven security, Visa is well-positioned for long-term growth.
Solid Earnings Estimate Revisions for V Stock
For fiscal 2025 (ending September 2025), the Zacks Consensus Estimate currently shows revenues of $39.63 billion, suggesting an improvement of 10.3% year over year and earnings per share of $11.37, indicating an increase of 13.1% year over year. The Zacks Consensus Estimate for the current year has improved 0.1% in the last 30 days.
For fiscal 2026 (ending September 2026), the Zacks Consensus Estimate currently shows revenues of $43.88 billion, suggesting an improvement of 10.7% year over year and earnings per share of $12.81, indicating an increase of 12.6% year over year. The Zacks Consensus Estimate for next year has improved 0.4% in the last 30 days.
Visa currently has a long-term (3-5 years) EPS growth rate of 13%, above the S&P 500’s long-term EPS growth rate of 12.6%.
Image Source: Zacks Investment Research
Attractive Short-Term Price Upside for V Shares
The short-term average price target of brokerage firms for the stock represents an increase of 11.3% from the last closing price of $351.29. The brokerage target price is currently in the range of $425-$305. This indicates a maximum upside of 21% and a downside of 13.2%.
Image Source: Zacks Investment Research
Investment Thesis for V Shares
Year to date, shares of Visa outperformed the broad-market index — the S&P 500. However, the stock significantly underperformed the S&P 500 in the past three months. Visa currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
The recent dip in stock price is a good opportunity to invest in this stock. Visa’s extensive AI thrust and effective business diversification will generate more value in the long term.
The chart below shows the price performance of V is the past three months.
Image Source: Zacks Investment Research