Like many growth stocks, Mastercard rebounded sharply from its bottom in late March due to a coronavirus pandemic. The giant in payment processing ended the third quarter of 2020 with a profit of 14.3%.
While COVID-19 is most likely to be a problem, Mastercard should stabilize again and grow in the long run. It may take some time for people to travel again in the same way they did before. Analysts see huge long-term growth potential for Mastercard (and also for Visa). According to Nielson, payment card purchases will increase by 139% in Europe and 87% in the United States between 2017 and 2027. However, as in many other industries and companies, the highest growth rates are expected in the Asia-Pacific region, with 330% growth to $ 57.2 trillion in purchases.
Graph: Global volume of purchases using payment cards
MasterCard’s growth drivers include continued growth in global consumer spending, gaining market share and a shift from cash to cards. As the second largest global card network (behind Visa), MasterCard is well positioned to benefit from market share gains in specific regions and consumer spending trends that have been relatively resilient even through economic cycles, ”said James Faucette, an analyst from Morgan Stanley.
“These trends should support double-digit revenue growth over the next few years. High incremental margins and opportunities to expand Vocalink and B2B capabilities should enable companies to grow in the longer term,” said Faucette.
Over the next 52 weeks, MasterCard Inc grew by an average of 33.9% on average based on performance over the past 14 years. MasterCard Inc grew in 12 of 14 years over the next 52 weeks, corresponding to a historical probability of 85%
22 stock analysts predict a 12-month average price of $ 370.32 with an optimistic forecast of $ 415 and a pessimistic forecast of $ 330. Of these 22 analysts, according to Tipranks, 19 rated it as “Buy”, three rated it as “Hold” and none rated it as “Sell”.
Sources: Investors.com, Seekingalpha.com, FXempire.com