MasterCard Inc. Earnings: Revenue Strengthens Again by Double Digits

S&P 500 (NYSE:SPY) component MasterCard Incorporated (NYSE:MA) reported its results for the first quarter. Mastercard is a multinational company whose principal business is to process payments and to provide related services to financial institutions and other customers. Its main services are in support of the credit, debit, prepaid, and related payment programs.

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MasterCard Incorporated Earnings Cheat Sheet for the First Quarter

Results: Net income for MasterCard Incorporated rose to $682 million ($5.36 per share) vs. $562 million ($4.29 per share) in the same quarter a year earlier. This marks a rise of 21.4% from the year-earlier quarter.

Revenue: Rose 17.1% to $1.76 billion from the year-earlier quarter.

Actual vs. Wall St. Expectations: MasterCard Incorporated beat the mean analyst estimate of $5.28 per share. Analysts were expecting revenue of $1.73 billion.

Quoting Management: “We had a good start to the year with solid first quarter results driven by an increase in processed transactions, the highest quarterly growth rate since our IPO, as well as positive volume growth in all regions as consumers continue to adopt electronic payments,” said Ajay Banga, MasterCard president and chief executive officer. “We are leveraging opportunities around the world. In the U.S., we have significantly improved our position in debit and now have the capability to process transactions on about half of all U.S. debit cards. Outside of the U.S., the acquisitions of DataCash and Access Prepaid Worldwide are delivering growth, both showing roughly 25% operational increases.”

Key Stats:

The company has enjoyed double-digit year-over-year percentage revenue growth for the past five quarters. Over that span, the company has averaged growth of 20.3%, with the biggest boost coming in the third quarter of the last fiscal year when revenue rose 27.3% from the year earlier quarter.

The company has now surpassed analyst estimates for four quarters in a row. It beat the mark by 13 cents in the fourth quarter of the last fiscal year, by 82 cents in the third quarter of the last fiscal year, and by 55 cents in the second quarter of the last fiscal year.

Net income has increased 4.1% year-over-year on average across the last five quarters. The biggest gain came in the third quarter of the last fiscal year, when income climbed 38.4% from the year-earlier quarter.

Looking Forward: Expectations for the company’s next-quarter performance are higher than they were ninety days ago. Over the past three months, the average estimate for the second quarter has risen to $5.57 per share from $5.50. The average estimate for the fiscal year is $22 per share, a rise from $21.53 ninety days ago.

(Company fundamentals provided by Xignite Financials. Earnings estimates provided by Zacks)

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