Visa released its results for the first quarter of the fiscal year after the end of the regular trading session on Thursday.
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Key points of the Visa report for the 1st fiscal quarter:
Earnings per share $1.42 vs. $ 1.46 a year earlier, consensus $ 1.28
Net revenue +12% QoQ and -6% YoY to $5.7 billion, forecast $5.52 billion
Cross-border transaction volume: -21% YoY vs. +9% a year earlier, forecast -25% YoY
Total Visa card payments: +4% YoY, forecast +3.67% yoy
Volume of payments excluding currency fluctuations: +5% YoY vs. +8% yoy a year earlier, forecast +6.39%
As the Covid-19 pandemic continues to create significant uncertainty in the global economy, the company has not released its forecast for the full fiscal year.
Visa shares rose 1% to $200.87 in the extended session after the end of regular trading on Thursday. Following the results of the regular trading on Thursday, the company's securities rose by 1.67% to $198.22. For Visa shares, 36 recommendations - "buy", 6 recommendations - "hold", 0 - "sell", according to data in the Bloomberg terminal. The 12-month consensus forecast is $237.89. This implies a potential increase of 20% to the closing price on Thursday, January 28.
At the same time, MasterCard shares ended Thursday trading up 2.8% to $324.28. The company released its report for the 4th quarter of 2020 in the afternoon, and its results were fully played out during the session.
Key points of the MasterCard report for the 4th financial quarter:
Adjusted earnings per share $1.64 vs. $ 1.96 a year earlier, consensus forecast $1.51
Earnings per share were $1.78 compared to $2.07 a year earlier
Net revenue -6.8% YoY to $4.1 billion, forecast $4 billion
Cross-border transaction volume: -29% YoY vs. +16% yoy
The total volume of payments using MasterCard: +4% yoy, consensus +6.1% y / y
Total MasterCard payments denominated in local currency: +1% to $1.747 trillion.
The growth of online spending during the New Year holidays is countered by the negative impact on income of the very fact of reducing international travel. Both Visa and MasterCard showed a smaller decline in revenue for the last 3 months of calendar 2020 than analysts expected.
And this is despite the fact that the volume of cross-border transactions on their cards decreased by 21% yoy (Visa) and 29% yoy (MasterCard). Namely, the volume of cross-border transactions is the most profitable for companies. However, Mastercard and Visa, in an effort to revive card spending, which has fallen due to a reduction in people's travel, have benefited from users making more purchases online.
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