Digital payments company Visa, Inc. (V) reported better-than-expected results for the third quarter of Fiscal Year 2021. The company’s robust results were driven by the growth in its net revenues.
Following the earnings, shares of the company declined approximately 1.1% to close at $248.25 in the extended trading session.
The company reported quarterly net revenues of $6.1 billion, up 27% from last year. It surpassed the consensus estimate of $5.8 billion. The rise in net revenues can be attributed primarily to the growth of 54% in international transaction revenues and 32% in data processing revenues.
It reported earnings per share (EPS) of $1.49, up 41% from last year, beating the consensus estimate of $1.34.
The CEO of Visa, Alfred F. Kelly, Jr., said, “Visa delivered another strong quarter as many key economies are well into a reopening-driven recovery. This was best demonstrated by credit and face-to-face spending bouncing back while debit and eCommerce volumes remained robust from accelerated cash digitization sparked by the pandemic. Additionally, cross-border travel spending improved as vaccination rates rose and more borders opened. Visa grew net revenues 27% and non-GAAP EPS 41% while continuing to make investments in strategies that will drive future growth.” (See Visa stock chart on TipRanks)
Recently, Goldman Sachs analyst Matthew O’Neill reiterated a Buy rating on the stock. The analyst, however, raised the price target from $262 to $264, which implies upside potential of 5.2% from current levels.
Consensus among analysts is a Strong Buy based on 20 Buys and 2 Holds. The average Visa price target of $272.75 implies upside potential of 8.7% from current levels.
Visa scores a “Perfect 10” on TipRanks’ Smart Score rating system, indicating that the stock has strong potential to outperform market expectations. Shares have gained 27.5% over the past year.
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