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

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MasterCard (MA - Free Report) closed the most recent trading day at $237.06, moving +0.49% from the previous trading session. This move outpaced the S&P 500's daily gain of 0.35%. Meanwhile, the Dow gained 0.03%, and the Nasdaq, a tech-heavy index, added 0.7%.

Prior to today's trading, shares of the processor of debit and credit card payments had gained 3.95% over the past month. This has lagged the Business Services sector's gain of 6.14% and the S&P 500's gain of 5.14% in that time.

MA will be looking to display strength as it nears its next earnings release, which is expected to be April 30, 2019. The company is expected to report EPS of $1.67, up 11.33% from the prior-year quarter. Meanwhile, our latest consensus estimate is calling for revenue of $3.88 billion, up 8.47% from the prior-year quarter.

MA's full-year Zacks Consensus Estimates are calling for earnings of $7.56 per share and revenue of $16.78 billion. These results would represent year-over-year changes of +16.49% and +12.24%, respectively.

Any recent changes to analyst estimates for MA should also be noted by investors. Recent revisions tend to reflect the latest near-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about 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, 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. Over the past month, the Zacks Consensus EPS estimate has moved 0.11% higher. MA is currently sporting a Zacks Rank of #3 (Hold).

Looking at its valuation, MA is holding a Forward P/E ratio of 31.2. This represents a premium compared to its industry's average Forward P/E of 21.59.

Also, we should mention that MA has a PEG ratio of 1.88. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. The Financial Transaction Services was holding an average PEG ratio of 1.66 at yesterday's closing price.

The Financial Transaction Services industry is part of the Business Services sector. This industry currently has a Zacks Industry Rank of 99, which puts it in the top 39% 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.

You can find more information on all of these metrics, and much more, on Zacks.com.




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