Mastercard (NYSE:MA) Notches Lower despite Higher Holiday Spending

With another Christmas in the books and New Year’s on the horizon, some have already begun to wonder just how the holiday shopping season fared this year. The word out of payment processor Mastercard (NYSE:MA) was better than some might have expected but not good enough to pull Mastercard out of a fractional decline in Tuesday afternoon’s trading. Indeed, spending, excluding automotive, was up 3.1% compared to this time last year, based on word from Mastercard’s SpendingPulse preliminary figures.

However, the bad news is that the SpendingPulse figures are not adjusted for inflation. That means that the core PCE inflation figure—which was up 3.2% against the same time last November—pretty much swamped the gains. Nevertheless, Mastercard’s chief economist, Michelle Meyer, noted that the “…economic backdrop remains favorable with healthy job creation and easing inflation pressures.”

The Numbers Weren’t that Healthy

Yet, even as Mastercard offered up a rosy look at the last couple of months, numbers showed up to rain on the parade. The 3.1% gain seen this year was a far cry from the 7.6% gain seen back in 2022 and couldn’t match Mastercard’s own projections issued back in September. Mastercard itself was looking for a 3.7% increase. It’s not a big miss, granted, but if it were an earnings report, Mastercard might be down over 3% itself right now. Overall, categories were mixed, as clothing sales were up 2.4%, while jewelry sales slipped 2%, and electronics sales slid 0.4%.

Is Mastercard Stock a Buy or Sell?

Turning to Wall Street, analysts have a Strong Buy consensus rating on MA stock based on 22 Buys and three Holds assigned in the past three months, as indicated by the graphic below. After a 23.07% rally in its share price over the past year, the average MA price target of $457.64 per share implies 8.17% upside potential.

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