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Visa (V) Gains But Lags Market: What You Should Know

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Visa (V - Free Report) closed the most recent trading day at $187.90, moving +0.04% from the previous trading session. The stock lagged the S&P 500's daily gain of 0.3%. Elsewhere, the Dow gained 0.27%, while the tech-heavy Nasdaq added 0.3%.

Heading into today, shares of the global payments processor had gained 3.32% over the past month, outpacing the Business Services sector's gain of 1.43% and the S&P 500's gain of 2.69% in that time.

Investors will be hoping for strength from V as it approaches its next earnings release. On that day, V is projected to report earnings of $1.43 per share, which would represent year-over-year growth of 10%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $6.06 billion, up 10% from the year-ago period.

Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $6.21 per share and revenue of $25.47 billion. These totals would mark changes of +14.15% and +10.84%, respectively, from last year.

It is also important to note the recent changes to analyst estimates for V. Recent revisions tend to reflect the latest near-term business trends. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.

Based on our research, we believe these estimate revisions are directly related to near-team stock moves. 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. The Zacks Consensus EPS estimate has moved 0.03% higher within the past month. V is holding a Zacks Rank of #3 (Hold) right now.

Investors should also note V's current valuation metrics, including its Forward P/E ratio of 30.26. This represents a premium compared to its industry's average Forward P/E of 24.53.

Also, we should mention that V has a PEG ratio of 1.95. 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 1.95 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 47, putting it in the top 19% 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.

Make sure to utilize Zacks. Com to follow all of these stock-moving metrics, and more, in the coming trading sessions.


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