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With a market cap of $419.42 billion, Mastercard Incorporated (MA) is a top global payment solutions company. It supports credit, debit, mobile, web-based, contactless payments, and other electronic payment programs for financial institutions and other organizations. Founded in 1966 and based in Purchase, New York, Mastercard offers a range of services to account holders, merchants, financial institutions, digital partners, businesses, governments, and more. The company is best known for its innovative and secure payment solutions, including its popular products like Mastercard, Maestro, and Cirrus.
Mastercard shares underperformed the broader market over the past year. The stock has gained 22.4% over this time frame, while the broader S&P 500 Index ($SPX) has rallied nearly 28.9%. But in 2024, MA stock has gained 5.8%, while the SPX is up 11.2% on a YTD basis.
Narrowing the focus, MA’s gains over the past 52 weeks are easily overshadowed by iShares U.S. Financial Services ETF (IYG). The exchange-traded fund has gained 33.4% over this period. Also, the ETF’s 10.4% returns on a YTD basis easily outshine the stock’s gains over the same time frame.
On May 1, Mastercard reported a strong Q1 performance, exceeding Wall Street expectations. However, the stock declined by 2% on the day its results were released.
For the current fiscal year, ending in December, analysts expect MA’s EPS to grow 16.1% to $14.23 on a diluted basis. The company's earnings surprise history is robust. It beat the consensus estimate in each of the last four quarters.
Among the 32 analysts covering MA stock, the consensus rating is a “Strong Buy.” That’s based on 28 “Strong Buy” ratings, three “Moderate Buys,” and one “Hold.”
This configuration is slightly more bullish than three months ago, with 25 suggesting a “Strong Buy.”
On May 6, Ramsey El Assal from Barclays maintained a “Buy” rating on Mastercard, with a price target of $530.00, implying a potential upside of 17.5% from current levels.
The mean price target of $498.41 represents a 10.5% premium to MA’s current price levels. The Street-high price target of $550 suggests an upside potential of 21.9%.
On the date of publication, Rashmi Kumari did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
