MasterCard (MA) PT Raised to $630 at KeyBanc Despite Soft Guide

KeyBanc analyst Alex Markgraff raised the price target on MasterCard (NYSE: MA) to $630.00 (from $600.00) while maintaining an Overweight rating.

The analyst commented: "Soft Guide on Tougher FX, Despite Macro Strength; Mastercard reported 4Q24 results (revenue, adj. EPS) ahead of the Street/ KBCM estimates led by payment network revenues and helped by lower than anticipated incentives. Revenue strength was helped by sustained consumer strength and the macro environment was said to remain supportive. Purchase volume growth was a touch ahead of the Street (including ~2.5% FX headwind), and data through the first four weeks of January pointed to stable volume growth (FX neutral). U.S. volume growth accelerated modestly in the same period mainly driven by an easier comp. Offsetting these is a modest deceleration in cross-border volume driven by intra-Europe. FY25 revenue guidance was below the Street (LDD) and includes an inorganic benefit of 1-1.5% and a 2% FX headwind (FX-affected organic growth of 10-11%). Opex growth guidance for FY25 is above the Street but includes a substantial inorganic component (~5%). We lower our FY25 net revenue and EPS factoring in substantial FX and M&A-related headwinds. Our FY26 revenue and EPS estimates move lower accordingly. Our willingness to look through these non-fundamental model impacts is a result of increasingly positive underlying drivers/macro commentary. As a result, we raise our PT to $630 based on 40.1x FY25 EPS."

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