Mastercard Incorporated (MA), headquartered in Purchase, New York, provides transaction processing and other payment-related products and services. Valued at $469.9 billion by market cap, the company offers payment processing services for credit and debit cards, electronic cash, automated teller machines, and travelers checks. The payments giant is expected to announce its fiscal fourth-quarter earnings for 2024 on Wednesday, Jan. 29.
Ahead of the event, analysts expect MA to report a profit of $3.68 per share on a diluted basis, up 15.7% from $3.18 per share in the year-ago quarter. The company has consistently surpassed Wall Street’s EPS estimates in its last four quarterly reports.
For the full year, analysts expect MA to report EPS of $14.46, up 17.9% from $12.26 in fiscal 2023. Its EPS is expected to rise 12.6% year over year to $16.28 in fiscal 2025.
MA stock has underperformed the S&P 500’s ($SPX) 25.8% gains over the past 52 weeks, with shares up 21.9% during this period. Similarly, it underperformed the Financial Select Sector SPDR Fund’s (XLF) 28% gains over the same time frame.
Mastercard's underperformance is driven by growing regulatory pressures to reduce swipe fees, increasing competition from "buy now, pay later" platforms like Affirm Holdings, Inc. (AFRM), and rising operating costs. Moreover, rejected settlements and potential fee reductions may squeeze margins. Its inflation and regulatory hurdles may limit consumer purchasing power. The company faces headwinds from proposed legislation, such as the Credit Card Competition Act of 2023, which could alter the competitive landscape and impact profitability.
On Oct. 31, MA shares closed down more than 2% after reporting its Q3 results. Its adjusted EPS of $3.89 beat Wall Street expectations of $3.73. The company’s revenue was $7.4 billion, topping Wall Street forecasts of $7.3 billion.
Analysts’ consensus opinion on MA stock is bullish, with a “Strong Buy” rating overall. Out of 37 analysts covering the stock, 29 advise a “Strong Buy” rating, three suggest a “Moderate Buy,” and five give a “Hold.” MA’s average analyst price target is $568.83, indicating a potential upside of 11.2% from the current levels.
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