The 10-second takeaway
For the quarter ended June 30 (Q3), Visa beat slightly on revenues and beat expectations on earnings per share.
Compared to the prior-year quarter, revenue grew and GAAP earnings per share dropped to a loss.
Gross margins dropped, operating margins grew, net margins shrank.
Visa reported revenue of $2.57 billion. The 30 analysts polled by S&P Capital IQ looked for a top line of $2.52 billion on the same basis. GAAP reported sales were 10% higher than the prior-year quarter's $2.32 billion.
Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.
EPS came in at $1.56. The 34 earnings estimates compiled by S&P Capital IQ forecast $1.45 per share. GAAP EPS were -$2.27 for Q3 compared to $1.46 per share for the prior-year quarter.
Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.
For the quarter, gross margin was 83.0%, 140 basis points worse than the prior-year quarter. Operating margin was 58.1%, 20 basis points better than the prior-year quarter. Net margin was -71.7%, 11,500 basis points worse than the prior-year quarter.
Next quarter's average estimate for revenue is $2.63 billion. On the bottom line, the average EPS estimate is $1.50.
Next year's average estimate for revenue is $10.26 billion. The average EPS estimate is $6.07.
The stock has a four-star rating (out of five) at Motley Fool CAPS, with 4,804 members out of 5,072 rating the stock outperform, and 268 members rating it underperform. Among 994 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 936 give Visa a green thumbs-up, and 58 give it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Visa is outperform, with an average price target of $133.38.
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Seth Jayson had no position in any company mentioned here at the time of publication. You can view his stock holdings here. He is co-advisor of Motley Fool Hidden Gems, which provides new small-cap ideas every month, backed by a real-money portfolio. Motley Fool newsletter services have recommended buying shares of Visa. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.