Visa (V) is expected to post EPS (earnings per share) of $1.11 in the third fiscal quarter (ending in June), boosted by strong business fundamentals. As we’ve discussed, the performance of payment technology companies (XLF) such as Discover Financial Services (DFS), Mastercard (MA), and American Express (AXP) is affected by the overall economy and client spending.
Visa reflected favorable views regarding its business fundamentals in the second fiscal quarter, stating that it has been focusing on long-term growth. The company could see its future results boosted by increased payment digitalization.
Expected revenue in fiscal Q3 2018
Visa’s revenue is expected to rise year-over-year to $5.0 billion in the third fiscal quarter, boosted by higher digital payment adoption. Its performance will also be sensitive to economic issues, as they significantly drive clients’ spending. Economic strength boosts Visa’s transactions, client spending, and revenue, while weakness in the form of recession, unemployment, and global trade decline impact the company’s growth. In the next part of this series, we’ll look at Visa’s valuation.