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MasterCard Posts Terrific Fourth Quarter Results

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Late last week, payment processor MasterCard (click ticker for report: ) announced terrific fourth quarter results. Revenue jumped 10% year-over-year to $1.9 billion, in line with expectations. Earnings, however, exceeded consensus estimates, growing 21% year-over-year to $4.86 per share. Much like Best Ideas Newsletter holding Visa (click ticker for report: ), MasterCard continues to ride secular tailwinds as the world moves to a cashless society. Though the US is MasterCard’s largest market, its credit card market share substantially lags that of Visa. Still, the company has tremendous global exposure. With credit and debit payments nearing maturity in the US, other markets (shown below) are driving the growth at MasterCard (Image Source: MasterCard Earnings Presentation). Although the company’s exposure to Europe may be … Read more

Who Wins in the Move to Online Retail?

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Over the weekend, turkey took a backseat to consumer spending with respect to the financial markets. According to ShopperTrak, total Black Friday sales dipped 1.8% year-over-year to $11.2 billion; however, online sales jumped 26% year-over-year to over $1 billion (ComScore). Due to the hyper-competiveness of the retail cohort during the holiday season, Black Friday (and Cyber Monday) has become more of an all-week promotional event. We expect online sales to continue be a driver of revenue expansion going forward, and we’ve identified a few names that we think will particularly benefit. Visa/Mastercard Although we prefer Visa (click ticker for report: ) from a valuation and brand strength perspective, it and Mastercard (click ticker for report: ) will be major beneficiaries of the … Read more