Over the past year, Visa Inc.'s V stock has declined 13.8%, but it has outperformed both the broader industry and key peer Mastercard Incorporated MA, which fell 25% and 18.2%, respectively. Still, the shares have badly trailed the S&P 500's 31.2% gain, a rally driven largely by mega-cap technology and artificial intelligence names.Another key peer, American Express Company AXP,gained 5.1% over the same period.
Visa continues to deliver steady revenue growth, expanding margins and strong shareholder returns, yet investors remain focused on regulatory risks and the possibility that new payment technologies could eventually weaken/disrupt its dominance.
Visa One-Year Price Performance Comparison
Image Source: Zacks Investment Research
The Regulatory Cloud Won't Go Away
Visa's biggest challenge is not operational. It is political and regulatory.
In the United States, the Department of Justice has accused Visa and Mastercard of using their market positions to maintain elevated merchant fees. At the same time, the proposed Credit Card Competition Act remains a source of uncertainty. The bill has bipartisan support and backing from the White House, keeping it firmly on investors' radar. However, despite the attention, it has yet to gain meaningful legislative traction.
Europe presents another area of concern.
In June 2025, the Competition Appeal Tribunal in London ruled that Visa and Mastercard's multilateral interchange fees breached European competition law. Britain's Payment Systems Regulator is also considering a reporting framework that would require greater disclosure of the companies' U.K. operations. If adopted, regulators would gain a clearer view of profitability, potentially strengthening the case for future pricing intervention.
Several U.K. banks are exploring domestic payment alternatives that could gradually reduce reliance on U.S.-based card networks. Meanwhile, the European Central Bank continues developing the digital euro, a project aimed in part at reducing Europe's dependence on foreign payment infrastructure. Consumers would access the system through banks and digital wallets, while the ECB would provide the underlying network.
Competition is Evolving
Fintech firms continue searching for ways to lower payment costs and reshape transaction economics. At the same time, real-time payment systems and upgraded bank networks are becoming faster and more capable. The more alternatives that emerge, the harder it becomes for Visa to justify premium pricing over the long term. Both Visa and Mastercard maintain that higher fees support investments in cybersecurity, fraud prevention and network reliability.
Stablecoins represent another potential challenge. If major retailers or technology companies eventually build large-scale payment ecosystems around digital currencies, some transactions could bypass traditional card networks altogether. While that risk remains largely theoretical today, it is one investors cannot completely ignore.
The Numbers Keep Telling a Different Story
For years, Visa has faced predictions that newer technologies would weaken its position. Yet the company's operating results continue to suggest otherwise.
Visa benefits from a simple but powerful business model. Whether consumers spend on travel, groceries, dining, subscriptions or online shopping, Visa earns a fee for facilitating transactions. It does not need to predict where spending shifts. It simply needs spending to occur.
This model remained highly effective during the second quarter of fiscal 2026. On a constant-dollar basis, cross-border volume increased 12%, supported by healthy international travel and continued strength in global e-commerce. Payment volume rose 9%, while processed transactions climbed 9% to 66.1 billion. Net revenues increased 17% year over year to $11.23 billion.
Value-Added Services (VAS) remain a fast-growing business and provide diversification benefits. Revenues from the segment rose 27% in constant dollars to $3.3 billion and now account for roughly 30% of total net revenues. Growth was driven by strong demand for network products and marketing services, areas that typically generate attractive margins while strengthening client relationships.
Visa is turning disruption into opportunity.
One of the more interesting developments is Visa's approach to stablecoins. Rather than treating digital assets as a threat, the company is working to position itself as the infrastructure layer connecting traditional finance with blockchain-based payment systems. Management has avoided making aggressive claims about stablecoins becoming a mainstream consumer payment method anytime soon. Even so, adoption trends are moving in Visa's favor.
During the second quarter of fiscal 2026, its stablecoin-linked card payment volumes surged nearly 200% from the prior year, supported by more than 160 programs globally. Its stablecoin settlement business has also gained traction. Visa reported a $7 billion annual run rate, representing more than 50% sequential growth. In April 2026, the company expanded its stablecoin settlement pilot to support nine blockchain networks, broadening its reach and increasing flexibility for partners. Rather than being displaced by emerging payment technologies, Visa increasingly appears to be embedding itself within them.
Shareholder Returns Remain a Priority
Visa continues to return substantial amounts of capital to shareholders. During the last reported quarter, the company returned $9.2 billion to shareholders, including $7.9 billion in buybacks and $1.3 billion in dividends. Management also authorized a new $20 billion multi-year repurchase program in April, reinforcing confidence in the company's long-term outlook.
Visa's dividend yield currently stands at 0.85%, modestly above Mastercard's 0.73%, though below American Express' 1.22%.
Visa’s Estimates Keep Moving Higher
For fiscal 2026, Visa’s EPS is now projected at $13.09, implying 14.1% year-over-year growth. For fiscal 2027, the estimate has moved up to $14.81, pointing to another 13.1% increase. Revenue expectations are moving higher, too. Analysts now forecast $45.35 billion in fiscal 2026 revenues and $50.04 billion in fiscal 2027, indicating growth of 13.4% and 10.3%, respectively.
Visa has beaten EPS estimates in each of the past four quarters, with an average surprise of 3.2%.
Visa Inc. Price, Consensus and EPS Surprise
Visa Inc. price-consensus-eps-surprise-chart | Visa Inc. Quote
Premium Valuation, Proven Business
Visa is not cheap. The stock trades at 22.27X forward earnings, well above the industry average of 15.75X. However, the valuation sits below the company's five-year median of 25.93X. Investors are still willing to pay a premium for Visa because few businesses combine its scale, profitability, global reach and consistency. For comparison, Mastercard trades at 22.87X forward earnings, while American Express trades at 16.68X.
Image Source: Zacks Investment Research
Should Investors Buy Visa Stock?
Visa continues to face regulatory scrutiny in the United States and Europe, while fintechs, real-time payment networks and stablecoins are working to reshape the payments landscape. These risks are real and help explain why the stock has lagged the broader market.
However, Visa's fundamentals remain strong. Payment volumes are growing, cross-border spending remains healthy, Value-Added Services are expanding rapidly, and the company is increasingly positioning itself within emerging payment technologies. Meanwhile, earnings estimates continue to move higher, supported by consistent execution.
While regulatory and competitive pressures are unlikely to fade, Visa's scale, network advantages and proven ability to adapt keep it well positioned for long-term growth. Supported by positive estimate revisions, Visa currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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This article originally published on Zacks Investment Research (zacks.com).
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
