Visa (V) Bests Mastercard (MA); Both Cos Look Strong

May 2, 2013 11:15 AM EDT
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Price: $246.39 -0.62%

Rating Summary:
    35 Buy, 7 Hold, 0 Sell

Rating Trend: Down Down

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    Up: 6 | Down: 5 | New: 9
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Recent results from Visa (NYSE: V) and Mastercard (NYSE: MA) reinforce the attractiveness of the both companies, in the view of analysts at Goldman Sachs, but Visa is the preferred stock.

"In our view, both MA and V stand poised to benefit from continued consumer and corporate purchase activity, international expansion, and the ramp of emerging payments," said analyst Julio C. Quinteros.

"On a relative basis we prefer V where we see potential for further upward EPS revisions and multiple expansion. Also, limited European exposure, return of growth in its US debit segment, and strong capital allocation support our positive view."

Recent results suggest further separation between the revenue growth performance of the networks with Visa outpacing Mastercard. However, Quinteros expected Mastercard to recover in the second half of the year.

Goldman Sachs has a Conviction Buy on Visa with a modified price target of $190.00 (from $188.00).

Goldman Sachs has Buy rating on Mastercard with a price target of $575.

For an analyst ratings summary and ratings history on Visa (NYSE: V) click here. For more ratings news on Visa click here.

Shares of Visa closed at $166.02 yesterday.

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