{"id":1153148,"date":"2025-10-10T11:09:28","date_gmt":"2025-10-10T08:09:28","guid":{"rendered":"https:\/\/www.etoro.com\/?p=1153148"},"modified":"2026-03-20T19:36:50","modified_gmt":"2026-03-20T17:36:50","slug":"deep-dive-can-visa-ring-up-gains","status":"publish","type":"post","link":"https:\/\/www.etoro.com\/en-us\/news-and-analysis\/market-insights\/deep-dives\/deep-dive-can-visa-ring-up-gains\/","title":{"rendered":"Deep Dive: Can Visa Ring Up Gains?"},"content":{"rendered":"

Meet the \u201ctoll booth\u201d of digital transactions: Visa. The Daily Breakdown dives into this company’s business to see what’s going on under the hood.<\/p>\n

Before we dive in, let\u2019s make sure you\u2019re set to receive The Daily Breakdown each morning. <\/span><\/i>To keep getting our daily insights<\/i><\/b>, all you need to do is <\/span><\/i>log in<\/span><\/i><\/a> to your eToro account.<\/span><\/i><\/p>\n

Deep Dive<\/b><\/h2>\n

Yesterday <\/span>we looked at the charts<\/span><\/a> for Visa and today we\u2019re taking a deeper dive into the fundamentals. Visa shares have struggled since the stock hit a record high in June, down about 7.5%. Despite that, Visa is up about 26% over the past year and sports an impressive long-term track record, up 368% over the last decade. For context, the S&P 500 is up \u201cjust\u201d 233% in that span.\u00a0<\/span><\/p>\n

The Business<\/b><\/h4>\n

Investors know Visa as a credit and debit card company \u2014 that much is obvious. But it\u2019s often referred to as the \u201ctoll booth\u201d of digital transactions. MasterCard enjoys a similar distinction. And while there are other credit card companies \u2014 like American Express, Capital One, and Synchrony Financial \u2014 they also function as banks. While there are pros and cons to each business model, Visa and MasterCard command much higher profit margins with their business.\u00a0<\/span><\/p>\n

\"\"<\/p>\n

Growth<\/b><\/h4>\n

Visa has grown its revenue and earnings at a compound annual growth rate (CAGR) of 11.1% and 15.7%, respectively. Looking forward, analysts expect impressive results as well, including:\u00a0<\/span><\/p>\n

Revenue growth estimates*: 11.4% in 2025, 10.6% in 2026, and 10% in 2027.\u00a0<\/span><\/p>\n

Earnings growth estimates*: 15.3% in 2025, 12.3% in 2026, and 12.7% in 2027.\u00a0<\/span><\/p>\n

*<\/span>Estimates according to Fiscal.ai<\/span><\/i><\/p>\n

Want to receive these insights straight to your inbox?<\/strong><\/p>\n

Sign up here<\/a><\/p>\n

Diving Deeper: Valuation<\/b><\/h2>\n

\"Visa's<\/p>\n

Trading at roughly 28x forward earnings expectations, Visa stock is about in-line with its long-term average. The stock has been considered relatively cheap when shares trade at about 23x to 24x forward earnings and expensive in the low- to mid-30x. Historically, many investors have justified Visa\u2019s premium valuation due to its elevated growth rates and high margins.\u00a0<\/span><\/p>\n

Risks & Bottom Line<\/b><\/h4>\n

The main risks to Visa are pretty obvious: Market volatility and economic activity.\u00a0<\/span><\/p>\n

If market volatility picks up, Visa isn\u2019t immune. For instance, the stock suffered a peak-to-trough decline of ~18.5% earlier this year amid the tariff tantrum. While this was actually <\/span>better<\/b> than the S&P 500\u2019s swing of 21.3%, it\u2019s still a big swing.\u00a0<\/span><\/p>\n

The other risk would be an economic slowdown or a recession. Because Visa is a global company, a global or US slowdown would be a negative for many businesses \u2014 credit card companies included \u2014 especially when it comes to consumption.\u00a0<\/span><\/p>\n

The Bottom Line: <\/b>Investors who believe Visa will continue to generate strong top- and bottom-line growth may justify the stock\u2019s valuation, which is at a slight premium to the S&P 500 but roughly in-line with its long-term average. Those who view the stock as unattractive at current levels may wait for Visa\u2019s valuation to potentially dip to a more attractive level or they may not like Visa\u2019s business and decide to disregard it altogether. <\/span><\/p>\n

Disclaimer:<\/i><\/b><\/p>\n

Please note that due to market volatility, some of the prices may have already been reached and scenarios played out.<\/i><\/b><\/p>\n","protected":false},"excerpt":{"rendered":"

Meet the \u201ctoll booth\u201d of digital transactions: Visa. The Daily Breakdown dives into this company’s business to see what’s going on under the hood. Before we dive in, let\u2019s make sure you\u2019re set to receive The Daily Breakdown each morning. To keep getting our daily insights, all you need to do is log in to…<\/p>\n","protected":false},"author":130,"featured_media":1245682,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"inline_featured_image":false,"footnotes":""},"categories":[6819],"tags":[],"asset_type":[],"class_list":["post-1153148","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-deep-dives"],"acf":[],"yoast_head":"The Daily Breakdown's Deep Dive: Can Visa Ring Up Gains?<\/title>\n<meta name=\"description\" content=\"Meet Visa, the \u201ctoll booth\u201d of digital transactions. 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