Stocks to Beat Q3 Consensus Expectations: Visa
Visa, which is the second-largest card payment system in the world after China's UnionPay, reported its equity per share (EPS) at $2.33 beating expert average estimate of $2.25. Its quarterly sales climbed 11% YoY, or 10% if calculated on a constant-dollar basis, to reach $8.6 billion, which was also slightly above the consensus forecast of $8.57B. The main drivers announced were payments volume and processed transactions. "We have seen resilient consumer spending, ongoing recovery of cross-border travel spend versus 2019 and continued growth across our new flows and value added services businesses,” Visa's CEO Ryan McInerney commented during the Q3 conference call.
The board of directors decided to raise the quarterly dividend for Visa shareholders by more than 15% to $0.52 per share, so that the annual yield on the dividend is 0.9% at the moment. Listed advantages and a new $25 billion multi-year shares buy-back program helped the stock to climb by nearly 2% after the closing bell on October 24. Yet, later on the market dynamics changed to lead to a nearly 1% decline on early October 25, as several investing groups, including Goldman Sachs, mentioned that slightly weaker forward guidance may damage income targets. Some analyst also citing contradictory inflation outlook which may rather unpredictably affect consumer spending trends, with volume likely to be somewhat weaker.
As to Visa management's own estimates, it projected adjusted net revenue growth to be at low double-digit for this financial year. So, against all odds, the basic scenario on an inflationary background is payment business growth, and we feel the market's sentiment for Visa is still positive, with a prospect to touch at least our target area above $250 in nearest months.
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