Credit Card Companies Weekly Notes: Visa And MasterCard

September 8th, 2014 · by Trefis Team
MAYTD+15.0%SPYYTD+11.9%XLFYTD+7.2%
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This past week credit card majors pushed ahead with a strategy to create seamless payment solutions for retail customers as well as businesses. Stock prices traded almost flat, with little change in the range of 1-2% through the week. Below we briefly recap the two major credit card companies – Visa (NYSE:V) and MasterCard (NYSE:MA) – for the week ended September 5.

Visa

Pursuant to its strategy to push towards mobile-based payments, Visa is entering into agreements with various retail brands and financial institutions to offer consumers seamless payments solutions through both mobile devices and online. [1] In the previous week, Visa entered into an agreement with Pizza Hut to allow the first million customers to redeem a free pizza, provided they use Visa Checkout to make payment. [2]

Visa’s stock was flat for the week at just over $214, touching a peak of $216. We have a price estimate of $217 for Visa’s stock, which is about less in line with the current market price. Our valuation for Visa implies a market cap of $166 billion.

See our full analysis of Visa here

[trefis_slideshow ticker=”V” rhs=”3″]

MasterCard

Last week, MasterCard in association with Basware, introduced Basware Pay, to better connect buyer and supplier payment processes. The introduction of the new tool enables improved optimization of working capital for these businesses. The tool provides a global e-payment solution that utilizes the Basware Commerce Network to approve invoices and MasterCards’ network to process transactions. Both MasterCard and Basware expect the solution to aid the payment process for businesses, mostly small and medium enterprises. [3]

MasterCards’ stock was mostly flat last week, closing at around $76, which is at a discount of over 10% to our estimate of $85 for MasterCards’ stock. We value the company at over $95 billion.

See our full analysis of MasterCard here

[trefis_slideshow ticker=”MA” rhs=”3″]

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Notes:
  1. NFL Fans Score with Visa Checkout – The Easier Way to Pay Online [↩]
  2. Pizza Hut and Visa Checkout ready to dish out a million pizzas [↩]
  3. MasterCard and Basware launch solution to unlock cash flow and improve prompt B2B payments [↩]
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