Is MasterCard Losing Its Grip? (MA, V)
Since yesterday, two stalwarts, Visa (NYSE: V) and MasterCard (NYSE: MA), have released their results for the latest quarter. Investor reaction to the two sets of results has been completely different. While V moved up in pre-market trading and continued its upturn when the market opened today, MA went into a sell-off mode and is still among the top three losers.
The opposite reactions were quite obviously the result of the numbers released by the two companies. MA, which posted a 23% jump in its earnings for Q4 with the help of higher fees, failed to meet Wall Street's view. MA’s earnings came at $2.24 per share, while the consensus expected $2.46.
The figure looks more disappointing in light of arch rival Visa’s consensus-beating EPS. MA was also behind V in terms of cards held and growth in processed transactions. While the number of cards carrying the Visa brand jumped 5%, the figure for the MasterCard brand fell 1.3%. Although both the companies saw an increase in processed transactions, Visa was way ahead of what MA could manage and what analysts had forecasted. Moreover, processed transactions at MasterCard were nearly half of the 10.9 billion reported by Visa.
The numbers speak for themselves. This difference is what was translated on the board, which showed a 0.79% gain in V’s share to $84.18 and an 8.80% downturn in MA’s stock to $225.84.
