Zacks Investment Research Upgrades Mastercard (NYSE:MA) to Buy

Zacks Investment Research upgraded shares of Mastercard (NYSE:MA) from a hold rating to a buy rating in a research report report published on Monday, February 5th. They currently have $191.00 target price on the credit services provider’s stock.

According to Zacks, “Mastercard’s stock has outperformed the industry in last year. The company is well positioned for growth, given its solid market position, ongoing expansion and digital initiatives, and significant opportunities from the secular shift toward electronic payments. The acquisitions of VocaLink and NuData Security complement the company’s efforts to participate in new payment flows and enhance its safety and security offerings.  Mastercard’s fourth-quarter earnings beat the Zacks Consensus Estimate by 1.8% year over year, driven by higher switched transactions, increase in cross-border volume and gross dollar volume as well as gains from acquisitions. An increase in rebates and incentives from the prior-year quarter was a partial dampener. It however, continues to face increasing costs. Also, higher incentives and rewards will put pressure on the bottom line.”

A number of other brokerages have also commented on MA. Piper Jaffray Companies raised their price objective on Mastercard from $208.00 to $212.00 and gave the stock an overweight rating in a research report on Friday, February 2nd. Morgan Stanley lifted their price target on Mastercard from $178.00 to $192.00 and gave the company an overweight rating in a report on Friday, February 2nd. Barclays lifted their price target on Mastercard from $178.00 to $195.00 and gave the company an overweight rating in a report on Friday, February 2nd. Cantor Fitzgerald lifted their price target on Mastercard to $198.00 and gave the company an overweight rating in a report on Friday, February 2nd. Finally, Guggenheim reiterated a buy rating and set a $201.00 price target on shares of Mastercard in a report on Friday, February 2nd. One research analyst has rated the stock with a sell rating, two have assigned a hold rating and thirty-one have given a buy rating to the stock. Mastercard presently has a consensus rating of Buy and an average target price of $176.64.

Mastercard (NYSE MA) opened at $170.13 on Monday. The firm has a market capitalization of $180,100.00, a PE ratio of 46.61, a P/E/G ratio of 1.56 and a beta of 1.26. Mastercard has a 12 month low of $107.76 and a 12 month high of $177.11. The company has a debt-to-equity ratio of 0.99, a current ratio of 1.57 and a quick ratio of 1.66.

Mastercard (NYSE:MA) last issued its quarterly earnings results on Thursday, February 1st. The credit services provider reported $1.14 earnings per share for the quarter, topping the Zacks’ consensus estimate of $1.12 by $0.02. The firm had revenue of $3.31 billion for the quarter, compared to analysts’ expectations of $3.25 billion. Mastercard had a return on equity of 83.57% and a net margin of 31.33%. Mastercard’s revenue was up 20.2% on a year-over-year basis. During the same quarter last year, the business posted $0.86 EPS. analysts expect that Mastercard will post 5.88 earnings per share for the current fiscal year.

The company also recently disclosed a quarterly dividend, which will be paid on Wednesday, May 9th. Stockholders of record on Monday, April 9th will be given a dividend of $0.25 per share. This represents a $1.00 dividend on an annualized basis and a dividend yield of 0.59%. The ex-dividend date of this dividend is Friday, April 6th. Mastercard’s dividend payout ratio is presently 27.40%.

Mastercard announced that its board has initiated a share repurchase plan on Monday, December 4th that permits the company to buyback $4.00 billion in outstanding shares. This buyback authorization permits the credit services provider to purchase shares of its stock through open market purchases. Stock buyback plans are typically an indication that the company’s management believes its stock is undervalued.

In other news, insider Edward Grunde Mclaughlin sold 17,167 shares of the business’s stock in a transaction that occurred on Tuesday, January 2nd. The stock was sold at an average price of $151.81, for a total transaction of $2,606,122.27. Following the sale, the insider now directly owns 47,901 shares in the company, valued at $7,271,850.81. The transaction was disclosed in a document filed with the SEC, which is accessible through the SEC website. Insiders own 0.30% of the company’s stock.

A number of hedge funds have recently made changes to their positions in MA. Profund Advisors LLC boosted its stake in Mastercard by 29.7% in the fourth quarter. Profund Advisors LLC now owns 30,818 shares of the credit services provider’s stock worth $4,665,000 after purchasing an additional 7,061 shares in the last quarter. Strategic Capital Advisers Inc. acquired a new position in Mastercard in the fourth quarter worth $243,000. BTG Pactual Global Asset Management Ltd boosted its stake in Mastercard by 15.0% in the fourth quarter. BTG Pactual Global Asset Management Ltd now owns 20,047 shares of the credit services provider’s stock worth $3,034,000 after purchasing an additional 2,614 shares in the last quarter. Huber Capital Management LLC boosted its stake in Mastercard by 86.0% in the fourth quarter. Huber Capital Management LLC now owns 25,950 shares of the credit services provider’s stock worth $3,928,000 after purchasing an additional 12,000 shares in the last quarter. Finally, University of Notre Dame DU Lac boosted its stake in Mastercard by 31.4% in the fourth quarter. University of Notre Dame DU Lac now owns 47,674 shares of the credit services provider’s stock worth $7,216,000 after purchasing an additional 11,383 shares in the last quarter. 75.66% of the stock is currently owned by institutional investors and hedge funds.

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Mastercard Company Profile

MasterCard Incorporated is a technology company that connects consumers, financial institutions, merchants, governments and businesses across the world, enabling them to use electronic forms of payment. The Company operates through Payment Solutions segment. The Company allows user to make payments by creating a range of payment solutions and services using its brands, which include MasterCard, Maestro and Cirrus.

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