Visa (NYSE:V) Shares Up 1.5% - Should You Buy?

Key Points

• Visa shares rose 1.5% to $371.09, while Wall Street maintained a bullish outlook. The stock has a consensus “Buy” rating and an average price target of $413.58.
• Visa exceeded quarterly expectations, reporting $3.32 in EPS and $11.63 billion in revenue; revenue increased 14.4% year over year, supported by a 50.78% net margin and 67.68% return on equity.
• The company declared a quarterly dividend of $0.67 per share and authorized a $20 billion share-repurchase program, though insiders have sold shares worth approximately $32.4 million over the past 90 days.

Visa Inc. (NYSE:V - Get Free Report) shares shot up 1.5% on Friday . The stock traded as high as $371.80 and last traded at $371.09. 6,665,680 shares were traded during mid-day trading, a decline of 16% from the average session volume of 7,890,429 shares. The stock had previously closed at $365.73.

Wall Street Analyst Weigh In

A number of equities research analysts recently issued reports on the company. BMO Capital Markets boosted their price objective on Visa from $387.00 to $405.00 and gave the company an "outperform" rating in a research note on Wednesday, July 29th. Barclays began coverage on shares of Visa in a research note on Tuesday, July 7th. They issued an "overweight" rating and a $420.00 target price for the company. Raymond James Financial reissued an "outperform" rating and issued a $406.00 price target on shares of Visa in a research report on Wednesday, July 29th. Citigroup restated a "buy" rating and set a $440.00 price target (up from $400.00) on shares of Visa in a research note on Wednesday, July 29th. Finally, TD Cowen reaffirmed a "buy" rating on shares of Visa in a report on Wednesday, July 29th. Seven analysts have rated the stock with a Strong Buy rating and twenty-four have assigned a Buy rating to the company. According to MarketBeat, Visa has a consensus rating of "Buy" and a consensus target price of $413.58.

Visa Stock Performance

The business has a 50 day moving average of $352.75 and a 200-day moving average of $329.35. The company has a market capitalization of $662.18 billion, a P/E ratio of 31.56, a price-to-earnings-growth ratio of 1.96 and a beta of 0.74. The company has a debt-to-equity ratio of 0.60, a quick ratio of 0.99 and a current ratio of 0.99.

Visa (NYSE:V - Get Free Report) last issued its earnings results on Tuesday, July 28th. The credit-card processor reported $3.32 EPS for the quarter, topping the consensus estimate of $3.23 by $0.09. The business had revenue of $11.63 billion during the quarter, compared to the consensus estimate of $11.40 billion. Visa had a return on equity of 67.68% and a net margin of 50.78%.The firm's revenue was up 14.4% compared to the same quarter last year. During the same quarter last year, the company earned $2.98 EPS. On average, sell-side analysts predict that Visa Inc. will post 13.16 EPS for the current fiscal year.

Visa Announces Dividend

The company also recently declared a quarterly dividend, which will be paid on Tuesday, September 1st. Stockholders of record on Tuesday, August 11th will be issued a $0.67 dividend. This represents a $2.68 dividend on an annualized basis and a dividend yield of 0.7%. The ex-dividend date of this dividend is Tuesday, August 11th. Visa's dividend payout ratio is presently 22.79%.

Visa declared that its board has approved a share repurchase plan on Tuesday, April 28th that permits the company to repurchase $20.00 billion in shares. This repurchase authorization permits the credit-card processor to purchase up to 3.6% of its stock through open market purchases. Stock repurchase plans are typically a sign that the company's management believes its shares are undervalued.

Insider Activity

In related news, CEO Ryan Mcinerney sold 20,970 shares of the company's stock in a transaction that occurred on Monday, June 29th. The shares were sold at an average price of $340.25, for a total transaction of $7,135,042.50. Following the sale, the chief executive officer owned 15,174 shares of the company's stock, valued at approximately $5,162,953.50. This represents a 58.02% decrease in their position. The transaction was disclosed in a legal filing with the SEC, which is accessible through this hyperlink. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Also, General Counsel Julie B. Rottenberg sold 2,027 shares of the stock in a transaction that occurred on Thursday, July 2nd. The stock was sold at an average price of $360.00, for a total transaction of $729,720.00. Following the completion of the sale, the general counsel owned 18,404 shares in the company, valued at $6,625,440. This represents a 9.92% decrease in their ownership of the stock. The SEC filing for this sale provides additional information. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Over the last ninety days, insiders sold 90,759 shares of company stock worth $32,375,779. 0.12% of the stock is owned by company insiders.

Institutional Inflows and Outflows

A number of hedge funds have recently made changes to their positions in the company. XXEC Inc. increased its stake in Visa by 153,118.8% in the 2nd quarter. XXEC Inc. now owns 186,260,448 shares of the credit-card processor's stock worth $63,904,097,000 after acquiring an additional 186,138,883 shares during the last quarter. Vanguard Group Inc. raised its holdings in shares of Visa by 0.7% in the 4th quarter. Vanguard Group Inc. now owns 160,975,832 shares of the credit-card processor's stock valued at $56,455,834,000 after acquiring an additional 1,054,343 shares in the last quarter. State Street Corp boosted its position in shares of Visa by 0.8% during the 4th quarter. State Street Corp now owns 82,798,151 shares of the credit-card processor's stock valued at $29,038,140,000 after acquiring an additional 626,821 shares during the last quarter. Geode Capital Management LLC boosted its position in shares of Visa by 0.9% during the 4th quarter. Geode Capital Management LLC now owns 44,042,586 shares of the credit-card processor's stock valued at $15,411,395,000 after acquiring an additional 388,996 shares during the last quarter. Finally, Price T Rowe Associates Inc. MD grew its holdings in shares of Visa by 1.8% during the fourth quarter. Price T Rowe Associates Inc. MD now owns 41,092,294 shares of the credit-card processor's stock worth $14,411,480,000 after purchasing an additional 716,218 shares in the last quarter. 82.15% of the stock is currently owned by hedge funds and other institutional investors.

Visa Company Profile

Visa Inc is a global payments technology company that facilitates electronic funds transfers and digital commerce by connecting consumers, merchants, financial institutions and governments. The firm operates one of the world's largest payment networks, providing processing, authorization, clearing and settlement services for credit, debit and prepaid card transactions. Visa's network-based model enables partner banks and other issuers to offer branded payment products while Visa focuses on the infrastructure, standards and technologies that move money securely and efficiently around the world.

Visa's product and service portfolio includes card-based payment products for consumers and businesses, real-time push-payment capabilities, tokenization and authentication services, fraud and risk-management tools, data analytics and APIs for fintech and merchant integration.

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