Bernstein analysts maintained their bullish stance on Mastercard stock, ahead of its investor day on September 9
Bernstein analysts have reiterated an Outperform rating on Mastercard Inc. (NYSE:MA) stock, with a 12-month target price (TP) of $108, ahead of its investor day on September 9. Bernstein believes that the global payments company will disappoint investors with its new long-term guidance, primarily due to its lack of commitment to additional margin expansion.
Mastercard’s commitment issue about additional margin expansion can ultimately bring down the earnings per share (EPS) growth objectives. However, the analysts expect Mastercard to deliver 18% EPS growth in absence of any margin expansion, which is mainly because of the expected volume growth tailwinds.
Recently, the company announced its intentions to acquire Applied Predictive Technologies for $600 million. Bernstein analysts expect the company to spend more time on the strategic and financial expectations for its recent acquisitions, which are not directly linked to its core business.
Mastercard reported its second quarter of fiscal 2015 (2QFY15) results on June 29; its adjusted EPS was $0.85, which came achingly close to beat its earnings estimate of $0.853. Furthermore, revenues were $2.39 billion, and missed its revenue estimates of $2.41 billion.
Jefferies analysts also weighed in on the stock, and reiterated an Outperform rating, with a $112 TP. They analysts believe that the event will primarily focus on its updated three-year constant currency outlook.
Of the 42 analysts who cover Mastercard stock, 34 suggest to buy, 6 recommend to hold, whereas the rest favor selling it. The 12-month consensus TP is $107.48. The stock closed down 1.28% on Friday, and rose approximately 4% compared to Dow Jones Index, which fell 10% since the start of the year.
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