Visa Stock Rises on Strong Earnings, Bullish Outlook

Multiple Visa credit cards — (Image credit: Getty Images)

Visa (V) stock is higher Friday after the payments company beat top- and bottom-line expectations for its fiscal 2025 first quarter and raised its full-year outlook.

In the three months ending December 31, Visa’s revenue increased 10% year over year to $9.5 billion, boosted by a 9% increase in payment volume, a 16% increase in cross-border volume and a 11% increase in processed transactions. Earnings per share (EPS) rose 14% from the year-ago period to $2.75.

"Visa's strong first-quarter results reflected healthy spending during the holiday season and improving trends in payments volume, cross-border volume, and processed transactions growth," Visa CEO Ryan McInerney said in a statement.

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The executive added that Visa remains "focused on serving our clients and innovating across our three growth levers – consumer payments, new flows and value-added services."

The payments processing giant appears to be operating on a business-as-usual basis amid an ongoing September 2024 antitrust lawsuit filed by the Department of Justice (DOJ) accusing it of "exclusionary and anticompetitive conduct."

During Visa's earnings conference call in October, McInerney said "the lawsuit is meritless and shows a clear lack of understanding of the payment ecosystem in the United States."

The results topped analysts' expectations. Wall Street was anticipating revenue of $9.3 billion and earnings of $2.66 per share, according to CNBC.

In its earnings presentation, Visa raised its full-year outlook. The company now anticipates low double-digit revenue growth and low-teens earnings growth. It had previously guided to high single-digit to low double-digit revenue growth and the high end of low double-digit earnings growth.

For the second quarter, Visa said it anticipates high single-digit to low double-digit revenue growth and high single-digit earnings growth.

Is Visa stock a buy, sell or hold?

Visa quickly recovered from a short sell-off triggered by the DOJ filing in September and has performed almost exactly in line with the S&P 500 over the trailing 12 months, generating a total return of 24.73% vs 24.97% for the index. And Wall Street remains bullish on the Dow Jones stock.

According to S&P Global Market Intelligence, the average analyst price target for V stock is $363.36, representing implied upside of more than 4% from current levels. Additionally, the consensus recommendation is a Buy.

Financial services firm Oppenheimer has an Outperform rating (equivalent to a Buy) with a $390 price target on the blue chip stock.

"Visa remains well-positioned to gain global market share from the multi-year runway to convert paper-based payments to card, enabling high-single payment volume growth over the next 3 years, at least," said Oppenheimer analyst Rayna Kumar in a note yesterday.

The analyst added that "the market is already pricing in slower growth based on our macro scenario analysis, and higher potential for regulatory risk."

Joey Solitro is a freelance financial journalist at Kiplinger with more than a decade of experience. A longtime equity analyst, Joey has covered a range of industries for media outlets including The Motley Fool, Seeking Alpha, Market Realist, and TipRanks. Joey holds a bachelor's degree in business administration.