Goldman Sachs Reiterates PT Of $88 And Buy On Visa (V)

In a research report published today, Goldman Sachs left its Buy rating and $88 price target on Visa V unchanged, in spite of Visa's better than expected Q1 results. In the report, Goldman states, "V reported 2QFY11 EPS of $1.23, above our and consensus estimate of $1.20 (+25%). Net revenue finished at $2.245 bn, above our estimate of $2.194 bn (+15.4% yoy), while operating margin of 61.6% was above our 61%. V reaffirmed its FY11 guidance for 11%-15% net revenue growth and +20% EPS growth. We have adjusted our model to reflect today's $0.03 beat and announced $1 bn share buyback, offset by higher assumed rebates/incentives (now 16.7% from 16.4%) and slightly lower margins in FY12 (61.2% vs 61.3%) and FY13 (62.2% from 62.6%). Our EPS estimates remain unchanged at $5.00 in FY11, $5.87 in FY12, and $6.82 in FY13. Accordingly, we maintain our $88 12-month target. In yesterday's trading, Visa lost 1.34% to close the day at $78.70. Its shares continued to lose value in today's pre-trading session as well, after falling 1.21% to $77.75.