Analysts’ views on Visa stock
Analysts still love Visa (V) stock, primarily because of its strong outlook. Higher spending is expected to boost its growth in fiscal Q3 2018. Of the 36 analysts covering Visa, 15 recommend “strong buy,” 17 recommend “buy,” and four recommend “hold.”
Analysts’ ratings were the same in May. In April, 37 were covering the stock, with 15 recommending “strong buy,” 18 recommending “buy,” and four recommending “hold.” Moving forward, analysts’ ratings will mainly depend on the economy and consumers’ spending patterns.
Overall, a stronger economy and job openings tend to boost consumer confidence, benefiting payment processing companies. As Visa and competitors (IYF) such as Mastercard (MA), Capital One Financial (COF), and Discover Financial Services (DFS) benefit from interest income, economic improvement helps them by boosting loan demand.
In the second quarter, Capital One’s consumer banking segment could be supported by higher loan demand boosting interest income. However, commercial loans might be impacted due to lower tax increasing corporates’ cash flow. In the next article, we’ll look at Visa Direct.