Financial services major Visa Inc. (NYSE: V) has reported better-than-expected results for the quarter ended December 31, 2021, on the back of robust growth in net revenues.
Following the upbeat earnings, shares of the company rose 5.3% to close at $217 in Thursday’s extended trading session.
Revenue & Earnings
Visa reported quarterly net revenues of $7.1 billion, up 24% from the prior year. Moreover, the figure surpassed the consensus estimate of $6.79 billion. Year-over-year growth of 19% and 50% in service revenues and international transaction revenues, respectively, drove the overall growth in net revenues. Together, these two components accounted for 76% of the total quarterly net revenues of the company.
Earnings per share (EPS) for the quarter stood at $1.81, up 27% from the previous year. Further, the figure topped the consensus estimate of $1.70.
Key Operating Metrics
Visa’s payments volume for the quarter increased 20% from the prior year on a constant dollar basis while total processed transactions witnessed a rise of 21% from the year-ago period.
Notably, the company also repurchased 19.4 million shares of class A common stock at an average price of $210.05 per share for $4.1 billion till December 31, 2021. On December 13, 2021, the board of directors authorized a new $12 billion class A common stock share repurchase program.
The CEO of Visa, Alfred F. Kelly, Jr., said, “Visa delivered very strong results with revenue, net income and EPS all growing at 24% or higher. The strength of our network, the growth in eCommerce, better than expected progress in the return of cross-border travel and a continuation of the recovery all contributed to an excellent quarter.”
Recently, Mizuho Securities analyst Dan Dolev reiterated a Hold rating on the stock with a price target of $220, which implies upside potential of 6.7% from current levels.
Wall Street’s Top Analysts have awarded Visa a Strong Buy consensus rating based on 12 Buys and 2 Holds. The average Visa price target of $265 implies upside potential of 28.6% from current levels. Shares have gained 4% over the past year.
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