Shares of the big credit-card companies on Monday dropped after a new report estimated a devastating hit to earnings and revenue should the coronavirus-driven lockdown of the U.S. economy last a year.
The investment firm Wedbush contends that as much as a third of the card companies' revenue and earnings could be lost if the coronavirus shutdown extends to a full 12 months.
While shares of Visa and Mastercard have both fallen more than 30% since the market peaked on Feb. 19, analysts at Wedbush say the two credit card giants face an additional drop of 20% or more if the lockdown goes past June, according to Bloomberg.
Wedbush slashed its price target on Visa, to $170 a share from $215, and on Mastercard, to $250 a share from $330.
A growing number of state and local governments are issuing ever more restrictive social- distancing rules in response to a surge in coronavirus infections and deaths.
They're shutting down large swaths of the American economy, with restaurants and brick-and-mortar retailers particularly hard hit.
At last check Visa fell 7.4% to $135.97 a share, Mastercard dropped 2.8% to $205.43 a share, while American Express tumbled 5.5% to $70.06 a share.