Visa (V) Falls More Steeply Than Broader Market: What Investors Need to Know

In the latest trading session, Visa (V) closed at $268.86, marking a -0.78% move from the previous day. The stock trailed the S&P 500, which registered a daily loss of 0.74%. Elsewhere, the Dow lost 1.06%, while the tech-heavy Nasdaq lost 0.58%.

Shares of the global payments processor have appreciated by 0.88% over the course of the past month, underperforming the Business Services sector's gain of 0.93% and the S&P 500's gain of 4.27%.

Market participants will be closely following the financial results of Visa in its upcoming release. On that day, Visa is projected to report earnings of $2.41 per share, which would represent year-over-year growth of 11.57%. In the meantime, our current consensus estimate forecasts the revenue to be $8.91 billion, indicating a 9.65% growth compared to the corresponding quarter of the prior year.

For the full year, the Zacks Consensus Estimates are projecting earnings of $9.94 per share and revenue of $35.86 billion, which would represent changes of +13.34% and +9.82%, respectively, from the prior year.

It's also important for investors to be aware of any recent modifications to analyst estimates for Visa. These revisions typically reflect the latest short-term business trends, which can change frequently. Hence, positive alterations in estimates signify analyst optimism regarding the company's business and profitability.

Research indicates that these estimate revisions are directly correlated with near-term share price momentum. To capitalize on this, we've crafted the Zacks Rank, a unique model that incorporates these estimate changes and offers a practical rating system.

The Zacks Rank system, running from #1 (Strong Buy) to #5 (Strong Sell), holds an admirable track record of superior performance, independently audited, with #1 stocks contributing an average annual return of +25% since 1988. Over the past month, there's been a 0.25% rise in the Zacks Consensus EPS estimate. Right now, Visa possesses a Zacks Rank of #3 (Hold).

Investors should also note Visa's current valuation metrics, including its Forward P/E ratio of 27.27. This expresses a premium compared to the average Forward P/E of 14.53 of its industry.

Investors should also note that V has a PEG ratio of 1.85 right now. The PEG ratio bears resemblance to the frequently used P/E ratio, but this parameter also includes the company's expected earnings growth trajectory. The Financial Transaction Services industry currently had an average PEG ratio of 0.97 as of yesterday's close.

The Financial Transaction Services industry is part of the Business Services sector. Currently, this industry holds a Zacks Industry Rank of 55, positioning it in the top 22% of all 250+ industries.

The Zacks Industry Rank assesses the vigor of our specific industry groups by computing the average Zacks Rank of the individual stocks incorporated in the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Keep in mind to rely on to watch all these stock-impacting metrics, and more, in the succeeding trading sessions.

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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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