The Next 12 Months Present An Attractive Risk/Reward For Visa

Visa Inc V remains one of the top picks in the market to capitalize on a consumer spending turnaround. Baird rolled out its fiscal year 2018 estimates, and believes the risk/reward spread on Visa is attractive over the next 12 months.

Baird analysts are projecting expected net revenue growth of 11 percent for Visa, with about 9 percent from legacy Visa and nearly 20 percent from Visa Europe. 2018 earnings estimates were set at $3.92. Adjusted operating margin is expected to be a percent higher at 67 percent in F2018.

Analysts cited double-digit revenue growth and EPS growth in the high teens were providing an attractive risk-reward spread on Visa.

"We view the stock as good risk/reward, though doubt initial F2017 EPS guidance will imply much different than our $3.32 estimate," Baird wrote in a note. The firm believes that Visa stock hitting $102 is a "pretty reasonable scenario."

Baird has a $95 price target with an Outperform rating, which it felt was a conservative target.