It has been a while since we've said anything good about a finance company, but it's true: Visa (NYSE:V) had an incredible quarter.

What recession?
Net income for the company rose 35% over last year, coming in at $574 million, or $0.74 per share. Revenue jumped 17%. Total branded cards in force grew by 10% to 1.7 billion. Payment volume rose 12%. There was little to complain about.

The results are pretty impressive in light of a shell-shocked consumer and a credit market clobbering competitors like American Express (NYSE:AXP), Discover Financial Services (NYSE:DFS), and Capital One (NYSE:COF). Visa -- along with MasterCard (NYSE:MA) -- doesn't issue credit, but it's no less immune to banks slashing credit lines to shore up their own books.

For the quarter, worldwide debit transactions increased 18%, while credit jumped 10%. The strength of debit is going to be vital for Visa, because its non-discretionary-spending appeal is much more resilient than credit, which often gets axed when consumers tighten their belts.    

So is Visa a buy? At $50 a share, you're paying about 19 times 2009 earnings estimates of $2.62 per share. That'd typically be a suicidal premium to pay for any company in the middle of a recession, but, Visa reaffirmed its guidance of at least 20% earnings growth through at least 2010. If those projections hold true, sure, Visa's probably a decent buy. Problem is:

  • Any company in any industry that thinks it can accurately predict what'll happen in these next two years is fooling itself. Go back two years from today and see how many CEOs predicted we might be nationalizing our banks and teetering on a depression, and you'll see what I mean.
  • Even though earnings guidance has been reaffirmed, management is already acknowledging dark clouds on the horizon, mentioning that "tougher economic trends in the second half of 2009" are to be expected. While not devastating, this only reassures me that my first worry is legitimate.
  • I say probably a good buy because, at 19 times forward earnings, the expectation of high growth is already priced in. Anything less and the bottom could fall out of this stock.

Summing it up
Despite the impressive quarter, Visa's investment appeal hasn't changed much: It's still a fantastic company with great potential, yet most of that potential is already baked into the share price. While the company continues to defy the global economic meltdown, I can't muster the courage to pay a premium when there're so many other screaming bargains in this market.

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Fool contributor Morgan Housel doesn't own shares in any of the companies mentioned in this article. Discover Financial Services and American Express are Motley Fool Inside Value picks. The Fool owns shares of American Express, and has a disclosure policy.