UPDATE: Citigroup Upgrades MasterCard to Buy, Raises PT

In a report published Friday, Citigroup upgraded its rating on MasterCard

from Neutral to Buy, and raised its price target from $437.00 to $525.00. Citigroup noted, “Following their investor day in NYC, we are raising our rating on MA to Buy from Neutral, as we believe the company can continue to deliver strong 20% long-term earnings growth, and the pull back in spend is stabilizing based on our channel checks and recent data. In addition, our contacts suggest the regulatory environment for the networks (a key concern that's held us back) is in good shape and that the merchant settlement MOU will likely get preliminary approval despite merchant pushback. While we recognize we are late on our call and the easy money has been made, we see no reason to remain on the side-lines given the attractive risk/reward, and our general positive view on cards & the broader equity market. And for perspective, rising equity markets should also support spend, as the top 20% income bracket drives 40% of U.S. consumer spend and ~50% of discretionary (i.e. wealth effect). Raising our target to $525.” MasterCard closed on Thursday at $454.18.