Yahoo Finance Is Visa (V) Set to Beat Earnings Estimates?
Shares of Visa V have climbed 3.3% over the last month in a sign that investors might be anticipating a strong quarter from the credit card giant. Now, let’s take a look to see what they should really expect from Visa’s quarterly earnings results.
Visa, and rival credit card power Mastercard MA just recently announced their plans to join forces via one single online payment function. The two card networks plan to drop their respective online payment options to try to become more attractive in the fight for e-commerce spends. This move helps illuminate just how competitive the online shopping world has become with PayPal PYPL, other fintech firms, and even tech giants like Apple AAPL, all fighting for online shoppers.
Clearly, Visa’s latest plan to grab more online payment business won’t show up on it upcoming earnings report, but it is worth noting how the company hopes to evolve in order to present shareholders more value going forward. With that said, Visa is coming off a strong quarter that saw the company’s earnings beat expectations and surge 25% from the year-ago period.
The question is: what’s in store for Visa when it reports its quarterly earnings results after market close on Wednesday, April 25.
Quarterly Outlook
Visa’s quarterly revenues are projected to climb by 6.8% to reach $4.78 billion, based on our current Zacks Consensus Estimates. Investors should be more impressed by the credit card firm’s quarterly earnings, which are expected to expand by 18.6% to hit $1.02 per share.
Still, these estimates don’t give investors any idea is Visa is expected to top its current earnings estimate, which is important because earnings beats can lead to positive stock price movement immediately following the release of quarterly financial results.
Luckily, Zacks Premium customers can utilize the Earnings ESP Screener in order to search for stocks that are expected to surprise, either way.
This is done because, generally speaking, when an analyst posts an estimate right before an earnings release, it means that they have fresh information which could potentially be more accurate than what analysts thought about a company two or three months ago.
A positive Earnings ESP paired with a Zacks Rank #3 (Hold) or better ranking helps us feel confident about the potential for an earnings beat. In fact, our 10-year backtest has revealed that this methodology has accurately produced a positive surprise 70% of the time.
Visa is currently a Zacks Rank #3 (Hold) and sports an Earnings ESP of 1.38%. The company’s Most Accurate Estimate—the representation of the most recent analyst sentiment—calls for earnings of $1.03 per share, which comes in 1 cent above our current consensus estimate. This means that investors should consider Visa a stock that could beat quarterly earnings estimates.
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