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Today October 25 Visa (V) reported September quarter earnings of 90 cents a share, 5 cents a share above Wall Street projections. Revenue climbed 13.9% year over year to $4.86 billion vs. Wall Street projections of $4.63 billion.
Payments volume, on a constant dollar basis, rose 10% year over year. Total processed transactions climbed 13% year over year.
The September quarter is the fourth quarter of Visa’s fiscal year so today the company released guidance for fiscal 2018. Visa expects revenue growth of high single digits and earnings growth at the high end of the mid-teens on a normal dollar basis. The Wall Street consensus looks for 15% earnings growth to $3.43 a share. Operating margins climbed to 66%, up five percentage points year over year
Visa is the largest processor of transactions in the world with a 58% market share. The United States accounts for about 43% of total volume. Globally 16,800 institutions belong to the Visa network. There were 3.2 billion Visa cards in circulation at the end of the September quarter. That’s a 27% increase year over year.
Visa shares were up 1.3% on the news this morning and have now passed my Jubak Picks target price of $108. As of today October 25 I’m raising my target price to $117 a share.
Shares of Visa are up 74.48% since I added them to my Jubak Picks portfolio on November 5, 2014.