Most investors would agree that Visa (V 0.09%) is one of the best companies in the world. Its steady growth, outsized profitability, and economic moat have made it a worthy portfolio addition, as shares have climbed 442% over the past decade. That performance is much better than the S&P 500's 167% gain.

But is it possible that by 2030, Visa can become a trillion-dollar stock? I think it's a very realistic outcome. Here's why.

Running the numbers

Visa's current market cap sits at just below $500 billion, meaning the valuation would need to double over the next seven years to hit our target. By running some numbers, we can gain some insights into how the $1 trillion mark becomes a reality.

As of this writing, Visa shares trade at a price-to-sales multiple of 15.8. If this remains constant between now and 2030, which is hard to predict but works for our calculation here, revenue would need to grow at an annualized rate of 10% over the next seven fiscal years.

Between fiscal 2012 and fiscal 2022 (ended September of last year), Visa's sales increased at a compound annual rate of 11%. So investors need to expect growth to decelerate slightly going forward, a reasonable assumption, in my opinion.

We can also look at the trailing price-to-earnings ratio, which currently stands at 30. If by 2030, this multiple is still the same as it is today, Visa's diluted earnings per share (EPS) would need to rise at 10% per year over the next seven fiscal years for the market cap to hit $1 trillion. Based on past financial results, I think this forecast is a bit too conservative. Visa's diluted EPS grew from $0.79 in fiscal 2012 to $7 in fiscal 2022, translating to an annualized rate of 24%.

It's clear that from a fundamental perspective, it's not a stretch to believe that Visa's market cap could eclipse $1 trillion by 2030. Visa would simply need to generate the same revenue growth and even slower earnings growth than in the past. That's not asking too much.

Strong competitive position

Investors can have confidence in Visa's long-term outlook because it's benefiting from the broad secular trend of cashless transactions. Cash is still a very popular method to transact within the U.S., one of the most developed nations in terms of using cards for payment. In developing countries, such as India, Visa has more of a growth runway to work with. A powerful tailwind, like the war on cash, increases the likelihood that Visa becomes a trillion-dollar business.

Thanks to its network effects, the company also benefits from a wide economic moat. Visa operates a two-sided platform that gets more valuable to merchants and cardholders as it gets bigger. The network processed a whopping $14.5 trillion in payment volume and 270 billion transactions in the trailing-12-month period, providing context into how massive Visa really is.

Joining the 13-figure club

There are six trillion-dollar companies today: Apple, Microsoft, Saudi Aramco, Alphabet, Amazon, and Nvidia. Such a high market cap appears reserved mainly for only the most dominant tech companies.

But Visa can break this trend. The company is, arguably, more important to the global economy than any other business worth more than $1 trillion right now. Just think what would happen if the card giant's network suddenly stopped working. It would certainly cause chaos everywhere as transactions would be unable to process, and money couldn't move around.

It's not a stretch for investors to expect that Visa's market cap will double within the next seven years.