Visa (V) is the worst Dow Jones stock Wednesday after the payments giant came up short on both the top- and bottom-lines in its fiscal third quarter.
In the three months ended June 30, Visa's revenue increased 10% year-over-year to $8.9 billion, driven by a 7% increase in payments volume, a 14% rise in cross-border volume and a 10% jump in processed transactions. Its earnings per share (EPS) rose 12% from the year-ago period to $2.42.
The company's strong quarter was helped by stability in its key business drivers, including processed transactions, said Visa CEO Ryan McInerney in a statement. "During the quarter, we expanded our partnerships with many clients around the world and announced several new innovations that will help drive the future of commerce."
From just $107.88 $24.99 for Kiplinger Personal Finance
Be a smarter, better informed investor.
Sign up for Kiplinger’s Free Newsletters
Profit and prosper with the best of expert advice on investing, taxes, retirement, personal finance and more - straight to your e-mail.
Profit and prosper with the best of expert advice - straight to your e-mail.
Still, Visa's results fell short of analysts' expectations. Wall Street was anticipating revenue of $8.96 billion and earnings of $2.43 per share, according to Bloomberg.
On the Visa's conference call, Chief Financial Officer Chris Suh said the company expects payments volume and processed transactions to grow at a similar rate in the final quarter of its fiscal year, while cross-border volume is expected to be slightly lower.
"Pulling it all together, we expect adjusted net revenue growth in the low double digits, which equates to a slight improvement from the 10% adjusted revenue growth rate in the third quarter," Suh said. He added that earnings per share is forecast to grow "in the high end of low double digits."
Is Visa stock a buy, sell or hold?
Visa shares are in negative territory on a year-to-date basis, but Wall Street is bullish on the blue chip stock. According to S&P Global Market Intelligence, the average analyst target price for V stock is $304.58, representing implied upside of about 19% to current levels. Additionally, the consensus recommendation is a Buy.
Financial services firm William Blair is bullish on Visa and thinks market participants should be buying the stock.
"We reiterate our Outperform [the equivalent of a Buy]rating and recommend investors allocate new investment dollars to Visa," William Blair analyst Andrew Jeffrey writes in a note to clients. "Our view remains that Visa is a core fintech holding, and we believe that the stock offers through-the-cycle outperformance and relative insulation from momentum-driven technology strategies."
Related Content
-
I'm 54 with a $320,000 IRA and will soon be self-employed, earning about $120,000 per year. How much should I be saving for retirement?We asked financial experts for advice.
-
This High-Performance Investment Vehicle Can Pump Up WealthLeave online real estate investing to the beginners. Accredited investors who want real growth need the wealth-building potential of Delaware statutory trusts.
-
I'm a Real Estate Investing Pro: This High-Performance Investment Vehicle Can Move Your Wealth Up a Gear
Leave online real estate investing to the beginners. Accredited investors who want real growth need the wealth-building potential of Delaware statutory trusts.
-
These Eight Tips From a Retirement Expert Can Help to Make Your Money Last Through RetirementAre you worried you will outlive your money? Considering these eight tips could go a long way toward ensuring your retirement money lasts as long as you do.
-
I'm an Investment Adviser: This Is the Retirement Phase Nobody Talks AboutWhat you do in the five years before retirement and the first 10 afterward can establish how comfortable you'll be for the rest of your life.
-
Gen X Turns 60: It's Time to Remix Your Retirement PlaylistIf you want a worry-free retirement, you can't keep playing the same old song. You need to freshen up your financial strategies, as well as your music.
-
I'm a Financial Adviser: Here's How a Three-Part Retirement 'Crash Plan' Can Prepare You for Market TurbulenceHaving a plan ready to go when markets get wild — covering how you'll handle income, rebalancing and taxes — can be the ultimate retirement secret weapon.
-
Investors Buy the Nasdaq's Big Dip: Stock Market TodayStocks are up and down again to end an up-and-down week ahead of big earnings announcements and the eventual return of regular economic data flow.
-
Here's How to Plan This Year's Roth Conversion, From a Wealth ManagerWhile time is running out to make Roth conversions before the end of the taxable year, consider taking your time and developing a long-term strategy.
-
Four Times You Need a Second Opinion on Your Financial PlanIs your financial plan fit for purpose — or is your adviser peddling an outdated strategy? When you see these red flags, it's time for a second opinion.Evan
