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Visa and Mastercard Dominate, Yet Are Still Growth Stocks

By Jason Hall - Jun 26, 2022 at 1:22PM

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These powerhouse stocks still have upside potential.

Both Visa (V 0.88%) and Mastercard (MA 1.97%) are solid portfolio picks, and could prove to be some of the top performers in the foreseeable future. In this clip from "The Future of Fintech" on Motley Fool Live, recorded on June 16, Motley Fool contributor Jason Hall discusses why both Visa and Mastercard could perform like growth stocks over the next decade despite being powerhouse stocks already.

Jason Hall: I very easily could see these being some of the better performers of this group over the next 5-10 years. The way I think about Visa and Mastercard is they are essentially the rails of the modern economy. There are so many companies on here that we're going to talk about that we might think about as competitors, Visa and Mastercard, but at the end of the day, their business is largely, maybe they're the locomotives or maybe they are the rail cars and Visa and Mastercard are the rails. These companies are so fundamentally important to how commerce has done. They're becoming increasingly important to things like business-to-business payments, global payments. It's really hard to quantify. Actually, it's not that hard to quantify because they give you the numbers about how large their market share is, and the thing to me that I think is just so striking about them is as large as they have become, and as substantial as their market shares are, they're still growth stocks. These are still companies that are growing very fast and because of their unit economics and the incredible operating margins that they generate. Their ability to continue to grow their earnings, this really amazingly asset-light business that is so moat-y, I think it's wonderful.

Jason Hall has positions in Mastercard and Visa. The Motley Fool has positions in and recommends Mastercard and Visa. The Motley Fool has a disclosure policy.

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Stocks Mentioned

Visa Inc. Stock Quote
Visa Inc.
$211.72 (0.88%) $1.84
Mastercard Incorporated Stock Quote
Mastercard Incorporated
$353.38 (1.97%) $6.84

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