Based on the aggregated intelligence of 170,000-plus investors participating in Motley Fool CAPS, the Fool's free investing community, credit card giant Visa (NYSE: V ) has earned a respected four-star ranking.
With that in mind, let's take a closer look at Visa's business and see what CAPS investors are saying about the stock right now.
|Headquarters (Founded)||San Francisco (1958)|
|Market Cap||$52.2 billion|
|Industry||Data processing and outsourced services|
|Trailing-12-Month Revenue||$8.34 billion|
Chairman/CEO Joseph Saunders
CFO Byron Pollitt, Jr.
|Return on Equity (Average, Past 3 Years)||9.6%|
|Cash/Debt||$3.89 billion / $41 million|
American Express (NYSE: AXP )
Discover Financial (NYSE: DFS )
MasterCard (NYSE: MA )
Sources: Capital IQ (a division of Standard & Poor's) and Motley Fool CAPS.
On CAPS, 95% of the 4,841members who have rated Visa believe the stock will outperform the S&P 500 going forward. These bulls include X4GG and All-Star rett448, who is ranked in the top 15% of our community.
Just last month, X4GG gave full credit to Visa: "Great business model with large moat. Spits out free cashflow like crazy. Currently cheap as concerns over debit card ruling are overblown."
Visa's brand power, cheapish valuation, and solid financial position continue to support its four-star CAPS status. In fact, at 24.8%, Visa's ratio of total liabilities to assets is lower than that of rivals American Express (89.1%), Discover (89.4%), MasterCard (41%), and CapitalSource (NYSE: CSE ) (78.3%).
CAPS All-Star rett448 elaborates on the bargain opportunity:
Visa has taken a large hit over uncertainty of financial legislation in Congress. The main issue which hurt Visa (and MasterCard as well) was limits on the transaction fees associated with debit cards. While at first look this could take a large bite out of Visa's revenue stream, the majority of the fees collected are transferred to the bank issuing the card. ... Additionally if the past serves as any guide, any legislation that is actually passed will be in a watered down form and the effect on business will be much less than initially thought.
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