Mastercard (MA), Loop to Simplify Payments in Saudi Arabia

Mastercard Incorporated MA recently collaborated with the Saudi Arabia-based digital payments technology company, Loop, in a bid to introduce a set of credit card offerings and payment solutions across the Kingdom. To this effect, the partners even inked an exclusive issuing deal. Its shares gained 0.4% on Mar 1.

As part of the partnership, the well-established technology and expertise of Mastercard will be put to use for issuing Bank Identification Number (“BIN”) ranges. A BIN is used to determine the issuing financial institution that a credit card belongs to. They also help in the speedier execution of financial transactions and offer a shield to cardholders from identity theft and fraud.

Therefore, the innovative payment solutions are expected to equip consumers, merchants and fintechs across the Kingdom to engage in seamless and safe digital payments and thereby, embrace digitization within daily lives. The move seems to be a time opportune one considering the thriving small and medium-sized enterprises, and fintech community of the Kingdom.

The tie-up seems to be a win-win situation for both Mastercard and Loop. It is expected to expand the presence of MA in the Kingdom and enable it to capture a sizeable share of the country’s digital payments market. The Middle East country continues to witness a booming digital economy. As for benefits to Loop, the collaboration will bolster its product and services suite.  

A promising digital economy propels Mastercard to undertake such digital transformation efforts in the Kingdom. In 2023, MA introduced new payment flows, leveraging its Mastercard Payment Gateway Services technology, to upgrade online payment solutions across Saudi Arabia. The Payment Gateway technology equips businesses to adopt up-to-date digital payment methods without suffering the intricacies of embracing new payment technologies.

Partnerships entered into or investments undertaken across the Kingdom are also reflective of Mastercard’s broader motive to establish a strong presence across the Middle East region, which has always remained a favorite spot for infusing greater digitization by the tech giant. Digital growth in the region is spurred by factors such as increased Internet penetration and higher usage of smartphones.

Shares of Mastercard have gained 29.9% in the past year compared with the industry’s 21.1% growth. MA currently carries a Zacks Rank #3 (Hold).

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Stocks to Consider

Some better-ranked stocks in the Business Services space are PagSeguro Digital Ltd. PAGS, Barrett Business Services, Inc. BBSI and ICF International, Inc. ICFI. While PagSeguro Digital sports a Zacks Rank #1 (Strong Buy), Barrett Business Services and ICF International carry a Zacks Rank #2 (Buy) at present. You can see the complete list of today’s Zacks #1 Rank stocks here.

The bottom line of PagSeguro Digital outpaced estimates in each of the last four quarters, the average beat being 10.12%. The Zacks Consensus Estimate for PAGS’ 2024 earnings suggests an improvement of 13.8% from the year-ago reported figure. The consensus mark for revenues suggests growth of 2.4% from the year-ago reported number. The consensus mark for PAGS’ 2024 earnings has moved 2.5% north in the past seven days.

Barrett Business Services’ earnings outpaced estimates in each of the trailing four quarters, the average surprise being 77.67%. The Zacks Consensus Estimate for BBSI’s 2024 earnings suggests an improvement of 5.3% from the year-ago reported figure. The consensus mark for revenues suggests growth of 6.8% from the year-ago reported number. The consensus mark for BBSI’s 2024 earnings has moved 1.4% north in the past seven days.

The bottom line of ICF International outpaced estimates in each of the last four quarters, the average beat being 6.02%. The Zacks Consensus Estimate for ICFI’s 2024 earnings suggests an improvement of 3.7% from the year-ago reported figure. The consensus mark for revenues suggests growth of 5.6% from the year-ago reported number. The consensus mark for ICFI’s 2024 earnings has moved 0.3% north in the past seven days.

Shares of PagSeguro Digital, Barrett Business Services and ICF International have gained 51%, 30.8% and 35.8%, respectively, in the past year.

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Mastercard Incorporated (MA) : Free Stock Analysis Report

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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