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After hours on Tuesday, April 26, Visa (V) reported earnings of $1.70 a share. That modestly beat analyst projections of $1.65 a share for the quarter. But it was a big jump from the $1.35 a share in the first quarter of 2021.

Visa said payment volumes rose 17% and cross-border volumes–which are exposed to travel and which generate high margins–climbed 38%. Cross-border volume has been Visa’s biggest issue through the pandemic, but results in the quarter suggest an ongoing and relatively sharp recovery.

The company’s earnings per share would have even higher except that the company saw an 11% increase operating expenses as it spent more on compensation in the tight labor market. But with the rebound in revenue Visa was able to leverage its costs and operating margins (based on net revenue) improved to 66.8% from 62.5% last year.

Visa’s shares were up 6.47% on Wednesday. Visa is a member of my Jubak Picks Portfolio where it is up 239.26% since I added it to that list on November 15, 2015. As of April 28 I’m raising the target price on Visa in Jubak’s Picks to $266 from the prior target of $194. I will also add the stock to my long-term 50 Stocks Portfolio.

Visa is extremely sensitive to the volume of consumer transactions and with a recession looming somewhere out there in 2023 or so, the stock isn’t without its risks. The shares trade at 35.47 times trailing 12-month earnings per share and they pay a tiny 0.71% dividend, hardly enough to support the price in any correction.

But I think that in the short run Visa is looking at a few more quarters of post-Pandemic recovery and the stock still trades, at the April 27 close of $214.11, well below the 52-week high of $$252.67.

In the longer run, payment networks have strong network effects–the more merchants accept Visa, the more consumers carry Visa–and of the the proliferation of new payment systems all use the Visa (or MasterCard (MA)) payment network for transactions. A big source of growth for Visa comes from the continuing shift to electronic payments. Global digital payments only recently passed cash payments as a share of transactions and there’s still a lot of growth in that trend. Visa’s network is also extremely scalable, which means that the company will be able to increase its operating margins–from an already high 65.72% (the 5-year average.) The company’s eye-catchingly high return on invested capital of 21.96% (5 year average) is one of the reasons I made it one of my “savings account” stocks in my recent Special Report 10 Greatest Savings Account Stocks back on September 15, 2021 on