Trade-Ideas: MasterCard (MA) Is Today's Post-Market Laggard Stock
Editor's Note: Any reference to TheStreet Ratings and its underlying recommendation does not reflect the opinion of TheStreet, Inc. or any of its contributors including Jim Cramer or Stephanie Link.
Trade-Ideas LLC identified
(
) as a post-market laggard candidate. In addition to specific proprietary factors, Trade-Ideas identified MasterCard as such a stock due to the following factors:
- MA has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $428.9 million.
- MA is down 2.6% today from today's close.
EXCLUSIVE OFFER: Get the inside scoop on opportunities in MA with the Ticky from Trade-Ideas. See the FREE profile for MA NOW at Trade-Ideas
More details on MA:
MasterCard Incorporated, a technology company, provides transaction processing and other payment-related products and services in the United States and internationally. The stock currently has a dividend yield of 0.7%. MA has a PE ratio of 29.3. Currently there are 19 analysts that rate MasterCard a buy, 1 analyst rates it a sell, and 7 rate it a hold.
The average volume for MasterCard has been 5.0 million shares per day over the past 30 days. MasterCard has a market cap of $100.9 billion and is part of the financial sector and financial services industry. The stock has a beta of 1.30 and a short float of 1.3% with 2.66 days to cover. Shares are up 5.8% year-to-date as of the close of trading on Monday.
Analysis:
rates MasterCard as a
. 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 solid stock price performance. We feel these strengths outweigh the fact that the company is trading at a premium valuation based on our review of its current price compared to such things as earnings and book value.
Highlights from the ratings report include:
- The revenue growth greatly exceeded the industry average of 19.9%. Since the same quarter one year prior, revenues rose by 13.6%. Growth in the company's revenue appears to have helped boost the earnings per share.
- MA's debt-to-equity ratio is very low at 0.23 and is currently below that of the industry average, implying that there has been very successful management of debt levels. Along with the favorable debt-to-equity ratio, the company maintains an adequate quick ratio of 1.45, which illustrates the ability to avoid short-term cash problems.
- MASTERCARD INC has improved earnings per share by 32.7% 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, MASTERCARD INC increased its bottom line by earning $3.09 versus $2.57 in the prior year. This year, the market expects an improvement in earnings ($3.50 versus $3.09).
- The net income growth from the same quarter one year ago has exceeded that of the S&P 500 and greatly outperformed compared to the IT Services industry average. The net income increased by 28.6% when compared to the same quarter one year prior, rising from $623.00 million to $801.00 million.
- The company's current return on equity greatly increased when compared to its ROE from the same quarter one year prior. This is a signal of significant strength within the corporation. In comparison to other companies in the IT Services industry and the overall market on the basis of return on equity, MASTERCARD INC has underperformed in comparison with the industry average, but has greatly exceeded that of the S&P 500.
- You can view the full MasterCard Ratings Report.
null