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Visa (V) Dips More Than Broader Markets: What You Should Know

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Visa (V - Free Report) closed at $170.38 in the latest trading session, marking a -0.26% move from the prior day. This change lagged the S&P 500's daily loss of 0.04%. Elsewhere, the Dow lost 0.05%, while the tech-heavy Nasdaq lost 0.01%.

Coming into today, shares of the global payments processor had gained 8.57% in the past month. In that same time, the Business Services sector gained 4.98%, while the S&P 500 gained 0.34%.

Investors will be hoping for strength from V as it approaches its next earnings release. The company is expected to report EPS of $1.33, up 10.83% from the prior-year quarter. Our most recent consensus estimate is calling for quarterly revenue of $5.70 billion, up 8.78% from the year-ago period.

For the full year, our Zacks Consensus Estimates are projecting earnings of $5.38 per share and revenue of $22.75 billion, which would represent changes of +16.7% and +10.4%, respectively, from the prior year.

Investors might also notice recent changes to analyst estimates for V. 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.

Research indicates that these estimate revisions are directly correlated with near-term share price momentum. 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 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. Within the past 30 days, our consensus EPS projection has moved 0.05% higher. V currently has a Zacks Rank of #2 (Buy).

Looking at its valuation, V is holding a Forward P/E ratio of 31.77. Its industry sports an average Forward P/E of 22.97, so we one might conclude that V is trading at a premium comparatively.

Also, we should mention that V has a PEG ratio of 1.93. 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. V's industry had an average PEG ratio of 1.93 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 38, putting it in the top 15% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our 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.

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