The 10-second takeaway
For the quarter ended Sep. 30 (Q4), Visa beat expectations on revenues and beat expectations on earnings per share.
Compared to the prior-year quarter, revenue grew and GAAP earnings per share grew significantly.
Gross margins shrank, operating margins dropped, net margins grew.
Visa reported revenue of $2.73 billion. The 31 analysts polled by S&P Capital IQ wanted to see a top line of $2.67 billion on the same basis. GAAP reported sales were 15% higher than the prior-year quarter's $2.38 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 $1.54. The 34 earnings estimates compiled by S&P Capital IQ predicted $1.50 per share. GAAP EPS of $2.05 for Q4 were 60% higher than the prior-year quarter's $1.28 per share.
Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.
For the quarter, gross margin was 82.8%, 90 basis points worse than the prior-year quarter. Operating margin was 55.8%, 140 basis points worse than the prior-year quarter. Net margin was 60.9%, 2,400 basis points better than the prior-year quarter.
Next quarter's average estimate for revenue is $2.81 billion. On the bottom line, the average EPS estimate is $1.78.
Next year's average estimate for revenue is $11.51 billion. The average EPS estimate is $7.17.
The stock has a four-star rating (out of five) at Motley Fool CAPS, with 4,816 members out of 5,081 rating the stock outperform, and 265 members rating it underperform. Among 1,003 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 952 give Visa a green thumbs-up, and 51 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 $139.28.
Is Visa playing the right part in the new technology revolution? Computers, mobile devices, and related services are creating huge amounts of valuable data, but only for companies that can crunch the numbers and make sense of it. Meet the leader in this field in "The Only Stock You Need To Profit From the NEW Technology Revolution." Click here for instant access to this free report.
- Add Visa to My Watchlist.
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. The Motley Fool has no positions in the stocks mentioned above. Motley Fool newsletter services recommend 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