MasterCard Gains As Market Dips: What You Should Know

MasterCard MA closed at $448.68 in the latest trading session, marking a +0.45% move from the prior day. The stock's change was more than the S&P 500's daily loss of 0.02%. Elsewhere, the Dow saw an upswing of 0.2%, while the tech-heavy Nasdaq depreciated by 0.09%.

Prior to today's trading, shares of the processor of debit and credit card payments had lost 1.78% over the past month. This has lagged the Business Services sector's gain of 1.77% and the S&P 500's gain of 4.59% in that time.

Investors will be eagerly watching for the performance of MasterCard in its upcoming earnings disclosure. In that report, analysts expect MasterCard to post earnings of $3.50 per share. This would mark year-over-year growth of 21.11%. Alongside, our most recent consensus estimate is anticipating revenue of $6.85 billion, indicating a 9.33% upward movement from the same quarter last year.

In terms of the entire fiscal year, the Zacks Consensus Estimates predict earnings of $14.22 per share and a revenue of $27.8 billion, indicating changes of +15.99% and +10.75%, respectively, from the former year.

Investors should also pay attention to any latest changes in analyst estimates for MasterCard. Recent revisions tend to reflect the latest near-term business trends. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.

Based on our research, we believe these estimate revisions are directly related to near-team stock moves. 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, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate has moved 0.11% lower. MasterCard is currently a Zacks Rank #3 (Hold).

Looking at valuation, MasterCard is presently trading at a Forward P/E ratio of 31.42. This expresses a premium compared to the average Forward P/E of 14.43 of its industry.

Meanwhile, MA's PEG ratio is currently 1.75. Comparable to the widely accepted P/E ratio, the PEG ratio also accounts for the company's projected earnings growth. The Financial Transaction Services industry currently had an average PEG ratio of 0.96 as of yesterday's close.

The Financial Transaction Services industry is part of the Business Services sector. With its current Zacks Industry Rank of 52, this industry ranks in the top 21% of all industries, numbering over 250.

The Zacks Industry Rank gauges the strength of our individual industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

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