MasterCard and Visa: Not as Similar as You Might Think

MasterCard and Visa: Not as Similar as You Might Think While MasterCard and Visa may seem absolutely interchangeable in our wallets, the firms themselves are seeing two very different realities in the most recent year and a half. Since the end of July in 2013, MA is up 46% while V is up 33%. Here are five charts that illustrate the differences between the two firms. Revenue (TTM) vs. Net Income (TTM) If we plot net income on the y-axis and total revenue on the x-axis, we can see that Visa is substantially larger than MA, with nearly 75% higher earnings and 40% higher revenue. [cml_ma_v_rev_niXY122.gif] Revenue, 1-year Growth vs. Net Income, 1-year Growth No we can plot net income, 1-year growth % on the x-axis and revenue, 1-year % on the y-axis. We can see that MA has grown net income more than 20% faster than V and has grown revenue 60% faster. [cml_ma_v_nigr_revgrXY122.gif] Return on Assets (ROA) (TTM) Charting net income over total assets (return on assets) on the y-axis and total assets and the x-axis, we can see an enormous difference in ROA, with MA exhibiting nearly 70% greater return on assets in the trailing-twelve-months. [cml_ma_v_roa_assetsXY122.gif] Return on Equity and Cash from Operations (TTM) With net income over total equity on the y-axis (return on equity) and cash from operations on the x-axis, we can MA has nearly 150% greater ROE than V. We can also see the size difference between the two firms, with V showing 80% larger cash from operations. [cml_ma_v_roe_cashXY122.gif] Stock Repurchases over Total Assets (TTM) MA is buying back substantially more of its own stock than V. In fact, of all mega caps with market caps greater than $50B, MA is the second highest, (MON is first and AAPL is third). The MA buyback program over the trailing-twelve-months is 150% larger than V. [cml_ma_v_stockrep_mktcapXY122.gif]