In a note to clients late Wednesday, Keene wrote that the multiple of 26 times estimated fiscal 2014 EPS is "a warranted premium to their two-year P/E average given double-digit revenue growth, ~20% EPS growth, stable FCF as well as limited risk from regulation and litigation settlement."
Sterne Agee analyst Greg Smith has a neutral rating on Visa, and in a client note late Wednesday wrote that the company is continuing to perform well, but that "we still do not see a favorable risk/reward here in light of competitive threats and potential regulatory-related pressures."
Regulatory pressures include a ruling in federal court against the Federal Reserve's implementation of the Durbin Amendment to the Dodd-Frank banking reform legislation, which some investors fear could hurt Visa's dominant market position.
KBW analyst Sanjay Sakhrani was upbeat following Visa's earnings report, reiterating his "outperform" rating and raising is price target for the stock to $238 from $217.00.Despite his view that Visa's fiscal fourth quarter was "uncharacteristically mixed," Sakhrani in a client note on Wednesday wrote "Visa shares remain an attractive investment given that the company has significant leverage to a strengthening economy and defensive attributes in an economy that is choppy. We also believe the long-term secular growth trends, the company's strategic positioning in the industry, operating leverage potential and solid capital management make the company a core holding." Visa's results were disappointing in some ways, but the company continues to post very solid growth numbers, which perfectly illustrate why investors need to look beyond the headlines focusing on the year-over-year decline in unadjusted earnings.