Visa Inc. (V – Free Visa Stock Report), a leading global electronic payments processor, has kicked off fiscal 2018 on a strong note. (Year ends on September 30th.) Revenues totaled $4.9 billion in the December period, representing a 9% advance from the year-earlier term. Moreover, the company earned $1.07 a share in the most recent quarter, which marked a 24% improvement from last year's figure. (Our respective top- and bottom-line targets for the fiscal first quarter were $5.0 billion and $1.03 a share.) Visa shares moved higher leading up to the earnings release, establishing an all-time high for the stock, but is pointing modestly lower ahead of today’s opening bell.
Growth in its international business was solid in the fiscal first quarter. On point, the company's overseas units reported somewhat sluggish transaction activity in the middle of fiscal 2017, but that trend started to reverse in the September term. Specifically, in the latest three-month stretch, total volumes in Latin America, Asia/Pacific, and the segment comprised of Central Europe, the Middle East, and Africa expanded 7.1%, 5.5%, and 6.8%, respectively, from the comparable span of 2017. Moreover, Visa's international business has accounted for more than 60% of the total in recent periods. (All figures are presented on a constant-dollar basis.)
The Dow-30 member seems poised for record-setting results this fiscal year. Indeed, payments volume and cross-border transactions increased 7.4% and 9.0%, respectively, in the December period, and Visa is on pace to eclipse 120 billion transactions for the full year. Our fiscal 2018 revenue forecast stands at $20.2 billion, but we've raised our bottom-line estimate by $0.20 a share, to $4.20. The former would represent growth of 10%, year over year, while the latter would mark a 20%-22% advance from 2017.
Visa remains the worldwide leader in the electronic payments space, and the stock carries our Highest (1) rank for Safety, and the company garners an excellent mark for Financial Strength (A++). In our view, this makes this issue an excellent selection for most portfolios, especially those with a conservative bent.
About The Company:Visa Inc. is the world’s largest retail electronic payments network providing processing services and payment product platforms. This includes credit, debit, prepaid, and commercial payments, which are offered under the Visa, Visa Electron, Interlink, and PLUS brands. Visa/PLUS is one of the largest global ATM networks, offering cash access in local currency in more than 200 countries. Visa’s global network, VisaNet, delivers value-added processing, including fraud and risk management.
— Sharif Abdou
At the time of this article’s writing, the author did not have positions in any of the companies mentioned.
