In the latest close session, Visa (V) was down 1.33% at $346.03. The stock fell short of the S&P 500, which registered a gain of 0.19% for the day. At the same time, the Dow added 0.66%, and the tech-heavy Nasdaq lost 0.03%.
Prior to today's trading, shares of the global payments processor had gained 7.22% outpaced the Business Services sector's gain of 2.28% and the S&P 500's gain of 0.54%.
The investment community will be paying close attention to the earnings performance of Visa in its upcoming release. It is anticipated that the company will report an EPS of $3.14, marking a 14.18% rise compared to the same quarter of the previous year. Our most recent consensus estimate is calling for quarterly revenue of $10.68 billion, up 12.32% from the year-ago period.
For the full year, the Zacks Consensus Estimates are projecting earnings of $12.81 per share and revenue of $44.45 billion, which would represent changes of +11.68% and +11.12%, respectively, from the prior year.
Investors should also pay attention to any latest changes in analyst estimates for Visa. These revisions typically reflect the latest short-term business trends, which can change frequently. Consequently, upward revisions in estimates express analysts' positivity towards the business operations and its ability to generate profits.
Our research reveals that these estimate alterations are directly linked with the stock price performance in the near future. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.
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, the Zacks Consensus EPS estimate has moved 0.02% higher. Currently, Visa is carrying a Zacks Rank of #3 (Hold).
From a valuation perspective, Visa is currently exchanging hands at a Forward P/E ratio of 27.38. This signifies a premium in comparison to the average Forward P/E of 12.55 for its industry.
Investors should also note that V has a PEG ratio of 2.06 right now. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. As of the close of trade yesterday, the Financial Transaction Services industry held an average PEG ratio of 0.92.
The Financial Transaction Services industry is part of the Business Services sector. This industry, currently bearing a Zacks Industry Rank of 201, finds itself in the bottom 18% echelons 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.
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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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.
