Prep Your Portfolio for a Cashless Societyhttp://www.fool.com/investing/general/2013/09/17/prep-your-portfolio-for-a-cashless-society.aspx Joseph Harry
September 17, 2013
Society is digitizing everything from music to money. According to estimates from Euromonitor, mobile commerce is expected to grow a whopping 386% from 2012 to 2017, which translates into $400 billion worldwide.
A cashless future?
Visa and MasterCard operate in a duopoly, and together processed almost 60% of the $13.8 trillion of card transactions last year. Both companies have been growing rapidly as well.
The growth in both earnings and dividends is especially impressive when looking at the balance sheets of Visa and MasterCard. Both companies carry billions in cash on their books, around $3.35 billion for Visa and $5 billion for MasterCard. Neither carries any debt. Of the two, Visa is much larger, with a market cap around $119 billion, as opposed to MasterCard's $80 billion.
The new way to pay?
Visa has separated itself from MasterCard by partnering with the world's largest smartphone vendor by market share, Samsung (NASDAQOTH: SSNLF). Samsung's Galaxy S4 is the first mobile device preloaded with Visa's payWave app. This allows S4 users to mak