Shares of Visa (V) fell in after-hours trading after the credit card company reported earnings for its third quarter of Fiscal Year 2024. Earnings per share came in at $2.42, which was in line with analysts’ consensus estimate. Sales increased by 9.9% year-over-year, with revenue hitting $8.9 billion. This missed analysts’ expectations of $8.924 billion.
In addition, there was a 7% rise in payment volume from the previous year when measured in constant currency. Excluding European transactions, the cross-border volume, a key driver of international revenue, surged 14% in constant currency. The total cross-border volume also saw a 14% uptick in the same period. Furthermore, the total transactions processed by Visa in this quarter amounted to 59.3 billion, a 10% annual growth.
Despite this solid growth, financial results still fell short of expectations. Interestingly, some analysts were already expecting this. According to TipRanks’ Bulls Say, Bears Say tool, one of the bearish concerns includes revenue growth and EPS targets. The bears attribute this to a change in consumer behavior and normalizing travel trends. Nevertheless, Visa is far from struggling, as it boasts a high-margin business that is durable and in a leading position to continue growing.
Is Visa stock a Buy, Sell, or Hold?
Turning to Wall Street, analysts have a Strong Buy consensus rating on Visa stock based on 17 Buys, four Holds, and zero Sells assigned in the past three months, as indicated by the graphic below. After an 11% rally in its share price over the past year, the average Visa price target of $315.42 per share implies 19.19% upside potential.
