Visa Inc. (V): Today's Featured Diversified Services Underperformer

Editor's Note: TheStreet ratings do not represent the views of TheStreet's staff or its contributors. Ratings are established by computer based on metrics for performance (which includes growth, stock performance, efficiency and valuation) and risk (volatility and solvency). Companies with poor cash flow or high debt levels tend to earn lower ratings in our model.

Visa ( V) pushed the Diversified Services industry lower today making it today's featured Diversified Services laggard. The industry as a whole closed the day down 1.7%. By the end of trading, Visa fell $2.48 (-1.5%) to $162.23 on average volume. Throughout the day, 2.4 million shares of Visa exchanged hands as compared to its average daily volume of three million shares. The stock ranged in price between $161.94-$164.03 after having opened the day at $163.88 as compared to the previous trading day's close of $164.71. Other companies within the Diversified Services industry that declined today were: InnerWorkings ( INWK), down 25.3%, Ambassadors Group ( EPAX), down 15.2%, Hudson Global ( HSON), down 9.4%, and ENGlobal Corporation ( ENG), down 7.3%.
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Visa Inc., a payments technology company, engages in the operation of retail electronic payments network worldwide. It facilitates commerce through the transfer of value and information among financial institutions, merchants, consumers, businesses, and government entities. Visa has a market cap of $85.38 billion and is part of the services sector. The company has a P/E ratio of 44.8, above the S&P 500 P/E ratio of 17.7. Shares are up 8.7% year to date as of the close of trading on Tuesday. Currently there are 19 analysts that rate Visa a buy, no analysts rate it a sell, and 10 rate it a hold.

TheStreet Ratings rates Visa as a buy. 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, increase in net income, expanding profit margins and solid stock price performance. We feel these strengths outweigh the fact that the company has had somewhat disappointing return on equity.

On the positive front, Infoblox ( BLOX), up 5.3%, WNS holdings ( WNS), up 5.2%, China HGS Real Estate ( HGSH), up 4%, and Lime Energy ( LIME), up 3.8%, were all gainers within the diversified services industry with Zillow ( Z) being today's featured diversified services industry leader.

For investors not wanting singular stock exposure, ETFs may be of interest. Investors who are bullish on the diversified services industry could consider iShares Dow Jones US Cons Services ( IYC) while those bearish on the diversified services industry could consider ProShares Ultra Short Consumer Sers ( SCC).

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