Piper Sandler Bullish on Visa and Mastercard, Sees Double-Digit Growth

Piper Sandler initiates coverage on Visa and Mastercard with Overweight ratings, setting price targets of $322 and $531, respectively. The firm cites secular growth drivers and potential for 12%+ revenue growth and mid-to-high teens EPS growth over the next three years.

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Nitish Verma
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Piper Sandler Bullish on Visa and Mastercard, Sees Double-Digit Growth

Piper Sandler Bullish on Visa and Mastercard, Sees Double-Digit Growth

Piper Sandler has initiated coverage on Visa (NYSE:V) and Mastercard (NYSE:MA) with Overweight ratings, setting price targets of $322 for Visa and $531 for Mastercard. The analyst, calls, bullish investment firm cites secular growth drivers and potential for 12%+ revenue growth and mid-to-high teens EPS growth over the next three years as reasons for the bullish stance.

Why this matters: The growth of digital payments has significant implications for the global economy, as it can increase financial inclusion and reduce transaction costs. As leaders in the payment processing industry, Visa and Mastercard's growth can have a ripple effect on the entire financial sector.

Visa and Mastercard are the two largest payment processors in the world, with Visa alone processing over $14 trillion in total volume in fiscal 2022 across more than 200 countries. Visa's beyond, numbers, analysts, discuss, stock systems are capable of handling over 65,000 transactions per second.

Piper Sandler believes both Visa and Mastercard are attractive businesses to own long-term given their scale and sustainable growth within the digital payments space. The firm expects the companies to deliver strong revenue and earnings growth in the coming years.

Visa's financial metrics underscore its market leadership. The company achieved a revenue growth rate of approximately 9.89% as of March 31, 2024. Its net margin of 53.14% and return on equity of 11.86% both exceed industry averages, reflecting Visa's efficiency and profitability.

analyst, calls, market, moving The initiation of coverage on Visa and Mastercard is part of a broader trend of Wall Street analysts making significant calls on various sectors. Other notable recent calls include Bernstein reiterating an outperform rating on Apple, Jefferies assigning a buy rating to Nvidia, and HSBC issuing buy ratings on major U.S. airlines.

With its $322 price target on Visa, Piper Sandler sees significant upside potential for the stock. Mastercard also offers compelling growth prospects based on the firm's $531 target. As digital payments continue to gain prevalence globally, Visa and Mastercard appear well positioned to capitalize on the secular shift away from cash transactions.

Key Takeaways

  • Piper Sandler initiates coverage on Visa and Mastercard with Overweight ratings.
  • Price targets: $322 for Visa, $531 for Mastercard, citing 12%+ revenue growth.
  • Visa and Mastercard's growth can increase financial inclusion and reduce transaction costs.
  • Both companies expected to deliver strong revenue and earnings growth in coming years.
  • Digital payments' secular growth drives Visa and Mastercard's long-term attractiveness.