Principal Financial Group Inc. Boosts Stake in Mastercard Incorporated $MA

Key Points

• Principal Financial Group increased its Mastercard stake by 2.5% in the first quarter, buying 58,987 additional shares and bringing its total holding to 2,437,439 shares valued at about $1.22 billion.
• Mastercard reported strong quarterly results, with EPS of $4.60 beating estimates and revenue of $8.40 billion topping forecasts, while revenue rose 15.8% year over year.
• Wall Street remains bullish on the stock, with a consensus Buy rating and average target price of $653.78, even as some insiders recently sold shares and Mastercard’s dividend remains modest at a 0.6% yield.

Principal Financial Group Inc. increased its position in shares of Mastercard Incorporated (NYSE:MA - Free Report) by 2.5% during the first quarter, according to the company in its most recent Form 13F filing with the SEC. The fund owned 2,437,439 shares of the credit services provider's stock after acquiring an additional 58,987 shares during the quarter. Mastercard makes up approximately 0.7% of Principal Financial Group Inc.'s holdings, making the stock its 28th biggest holding. Principal Financial Group Inc. owned approximately 0.27% of Mastercard worth $1,217,899,000 at the end of the most recent quarter.

A number of other hedge funds have also recently added to or reduced their stakes in MA. Vanguard Group Inc. grew its holdings in shares of Mastercard by 0.6% during the 4th quarter. Vanguard Group Inc. now owns 79,897,854 shares of the credit services provider's stock worth $45,612,087,000 after purchasing an additional 466,514 shares during the period. J. Stern & Co. LLP lifted its position in Mastercard by 53,535.0% during the fourth quarter. J. Stern & Co. LLP now owns 72,597,097 shares of the credit services provider's stock valued at $41,444,231,000 after buying an additional 72,461,743 shares in the last quarter. State Street Corp grew its stake in Mastercard by 2.8% during the third quarter. State Street Corp now owns 36,580,374 shares of the credit services provider's stock worth $20,807,283,000 after buying an additional 997,536 shares during the period. Geode Capital Management LLC grew its stake in Mastercard by 1.7% during the fourth quarter. Geode Capital Management LLC now owns 20,686,605 shares of the credit services provider's stock worth $11,773,153,000 after buying an additional 349,369 shares during the period. Finally, Capital International Investors increased its position in shares of Mastercard by 4.4% in the fourth quarter. Capital International Investors now owns 17,964,658 shares of the credit services provider's stock worth $10,256,368,000 after acquiring an additional 759,584 shares in the last quarter. 97.28% of the stock is owned by institutional investors and hedge funds.

Mastercard Price Performance

Shares of MA opened at $537.02 on Tuesday. Mastercard Incorporated has a 52 week low of $464.52 and a 52 week high of $601.77. The company has a current ratio of 0.98, a quick ratio of 0.98 and a debt-to-equity ratio of 2.56. The firm has a market cap of $474.50 billion, a price-to-earnings ratio of 31.08, a PEG ratio of 1.64 and a beta of 0.73. The stock has a 50 day moving average of $500.32 and a 200-day moving average of $516.83.

Mastercard (NYSE:MA - Get Free Report) last posted its quarterly earnings results on Thursday, April 30th. The credit services provider reported $4.60 earnings per share (EPS) for the quarter, beating the consensus estimate of $4.41 by $0.19. Mastercard had a return on equity of 212.96% and a net margin of 45.88%.The business had revenue of $8.40 billion for the quarter, compared to analyst estimates of $8.26 billion. During the same period in the prior year, the company posted $3.73 EPS. The business's revenue was up 15.8% compared to the same quarter last year. As a group, analysts forecast that Mastercard Incorporated will post 19.61 EPS for the current year.

Mastercard Dividend Announcement

The firm also recently announced a quarterly dividend, which will be paid on Friday, August 7th. Shareholders of record on Thursday, July 9th will be issued a dividend of $0.87 per share. This represents a $3.48 dividend on an annualized basis and a dividend yield of 0.6%. The ex-dividend date of this dividend is Thursday, July 9th. Mastercard's dividend payout ratio is 20.14%.

Analyst Upgrades and Downgrades

Several research firms recently weighed in on MA. Susquehanna reduced their target price on shares of Mastercard from $670.00 to $665.00 and set a "positive" rating on the stock in a report on Friday, May 1st. Robert W. Baird raised their price objective on Mastercard from $660.00 to $680.00 and gave the company an "outperform" rating in a research report on Tuesday, July 7th. BMO Capital Markets assumed coverage on Mastercard in a research report on Tuesday, April 21st. They issued an "outperform" rating and a $605.00 target price for the company. Piper Sandler assumed coverage on Mastercard in a research note on Monday, June 29th. They issued an "overweight" rating and a $597.00 target price for the company. Finally, Royal Bank Of Canada dropped their target price on Mastercard from $656.00 to $629.00 and set an "outperform" rating on the stock in a report on Friday, May 1st. Seven equities research analysts have rated the stock with a Strong Buy rating, twenty-one have issued a Buy rating, one has given a Hold rating and one has issued a Sell rating to the stock. According to data from MarketBeat, the company has a consensus rating of "Buy" and a consensus target price of $653.78.

Insider Transactions at Mastercard

In related news, insider Raj Seshadri sold 4,828 shares of the stock in a transaction dated Wednesday, July 1st. The shares were sold at an average price of $525.00, for a total transaction of $2,534,700.00. Following the sale, the insider owned 16,429 shares in the company, valued at $8,625,225. This represents a 22.71% decrease in their ownership of the stock. The transaction was disclosed in a legal filing with the Securities & Exchange Commission, which is available through this hyperlink. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Also, insider Sandra A. Arkell sold 200 shares of Mastercard stock in a transaction that occurred on Monday, July 6th. The shares were sold at an average price of $540.00, for a total value of $108,000.00. Following the completion of the transaction, the insider owned 3,322 shares of the company's stock, valued at approximately $1,793,880. The trade was a 5.68% decrease in their ownership of the stock. The disclosure for this sale is available in the SEC filing. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Over the last 90 days, insiders sold 7,005 shares of company stock worth $3,689,976. Insiders own 0.09% of the company's stock.

Key Headlines Impacting Mastercard

Here are the key news stories impacting Mastercard this week:

• Positive Sentiment: Mastercard shares are being supported by broader strength in financial stocks, which rose late in the session and helped lift sentiment across the sector. Sector Update: Financial Stocks Rise Late Afternoon
• Positive Sentiment: Analysts continue to point to meaningful upside in Mastercard, with Buy ratings and favorable MarketRank/price-target sentiment reinforcing a constructive outlook for the stock. Analysts See Major Upside for These 5 Stocks (MA)
• Positive Sentiment: Mastercard also gained attention after adding NordVPN to its lifestyle perks, a small but positive consumer-facing enhancement that could support cardholder engagement. NordVPN is now part of Mastercard’s lifestyle perks — find out if you are eligible
• Neutral Sentiment: News that Mastercard is reviewing options for its U.K. payments subsidiary Vocalink suggests portfolio optimization, but the financial impact is still unclear because talks are reportedly early and no deal has been announced. Mastercard examines sale of UK payments subsidiary Vocalink
• Neutral Sentiment: Additional reports that Mastercard may sell a majority stake in Vocalink, and commentary about overseas regulators and “payment protectionism,” could matter strategically, but they do not yet indicate a completed transaction or immediate earnings impact. Mastercard in early talks to sell majority stake in Vocalink– report
• Negative Sentiment: The Vocalink headlines also highlight regulatory pressure in the U.K. and concerns about foreign ownership of critical payments infrastructure, which could create uncertainty or limit Mastercard’s strategic flexibility. Mastercard's Vocalink rumors and the rise of payment protectionism

Mastercard Company Profile

Mastercard Incorporated is a global payments technology company that operates a network connecting consumers, financial institutions, merchants, governments and businesses in more than 200 countries and territories. The company facilitates electronic payments and transaction processing for credit, debit and prepaid card products carrying the Mastercard brand, while also providing a range of payment-related services to issuers, acquirers and merchants. Its technology and network enable authorization, clearing and settlement of payments and support a broad set of use cases including point-of-sale, e-commerce and mobile payments.

Beyond core transaction processing, Mastercard offers a suite of value-added services such as fraud and risk management, identity and authentication tools, tokenization and digital wallet support, cross-border and commercial payment solutions, and data analytics and consulting services for merchants and financial partners.

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