NEW YORK (TheStreet) -- Visa Inc.
(V - Get Report) announced the launch of Visa Checkout, a payment service replacing V.me, to make the online checkout experience faster and easier when making purchases.
The service puts pressure on eBay's (EBAY - Get Report) PayPal service, which also allows customers to pay for goods online from any device with a few clicks, using just a log-in and password.
Shares of Visa are down -1.72% to $218.83 and eBay is up 1.53% to $51.47.
Visa will drive broad awareness for Visa Checkout through a multi-million dollar advertising campaign, and said Neiman Marcus and United Airlines (UAL) have signed up as participating merchants.
"We rate VISA INC (V) a BUY. This is based on the convergence of positive investment measures, which should help this stock outperform the majority of stocks that we rate. The company's strengths can be seen in multiple areas, such as its revenue growth, largely solid financial position with reasonable debt levels by most measures, impressive record of earnings per share growth, compelling growth in net income and expanding profit margins. Although the company may harbor some minor weaknesses, we feel they are unlikely to have a significant impact on results."
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- The revenue growth came in higher than the industry average of 16.1%. Since the same quarter one year prior, revenues slightly increased by 6.9%. Growth in the company's revenue appears to have helped boost the earnings per share.
- V has no debt to speak of therefore resulting in a debt-to-equity ratio of zero, which we consider to be a relatively favorable sign. Along with the favorable debt-to-equity ratio, the company maintains an adequate quick ratio of 1.44, which illustrates the ability to avoid short-term cash problems.
- VISA INC has improved earnings per share by 31.3% in the most recent quarter compared to the same quarter a year ago. The company has demonstrated a pattern of positive earnings per share growth over the past two years. We feel that this trend should continue. During the past fiscal year, VISA INC increased its bottom line by earning $7.58 versus $3.13 in the prior year. This year, the market expects an improvement in earnings ($9.00 versus $7.58).
- The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the IT Services industry. The net income increased by 25.8% when compared to the same quarter one year prior, rising from $1,270.00 million to $1,598.00 million.
- The gross profit margin for VISA INC is rather high; currently it is at 68.13%. It has increased from the same quarter the previous year. Along with this, the net profit margin of 50.52% significantly outperformed against the industry average.
- You can view the full analysis from the report here: V Ratings Report