Despite Visa’s (V) premium valuation, analysts are still bullish about the stock and foresee double-digit growth in its stock price. Visa’s consistent strong quarterly performances along with its encouraging outlook for fiscal 2018 has instilled confidence among analysts as reflected in their ratings.
The majority of analysts recommended a “strong buy” or “buy” on Visa. These recommendations represented ~89% of the 38 analysts covering the stock. Meanwhile, 11% of analysts recommended “holds,” and there weren’t any “sell” recommendations on the stock. Analysts have given Visa a target price of $160.09, which is a 12.2% surge from the current level of $142.67. In 2017, the stock gained ~46%.
Analysts are bullish on the entire financial transaction processing industry and have therefore given “buy” recommendations to all of Visa’s peers including Mastercard (MA), PayPal (PYPL), and Global Payments (GPN).
For Mastercard, 15 of the 41 analysts provided a “strong buy” opinion, 23 gave “buy” ratings, while the remaining three have a “hold” stance, as of September 6. The target price of $229.28 represents an 8.6% increase from the current price of $211.16.
Out of 44 analysts, 15 provided “strong buy” ratings, 19 gave “buy” ratings, while the remaining ten have “hold” recommendations on PayPal. Wall Street’s target price of $96.58 represents an 8.5% increase from the current price of $89.05.
For Global Payments, 12 of the 32 analysts provided a “strong buy” recommendation, 13 have a “buy” stance, six have a “hold” rating, and one analyst has a “sell” on the stock. With a target price of $132.90, Wall Street forecasts a 7.5% rise from the current market price of $123.69.
Visa makes up ~5% of the iShares Edge MSCI U.S.A. Momentum Factor ETF (MTUM).