MasterCard Incorporated Earnings Cheat Sheet: Beats Analysts’ Estimates

S&P 500 (NYSE:SPY) component MasterCard Incorporated (NYSE:MA) reported net income above Wall Street’s expectations for the third 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 Third Quarter

Results: Net income for MasterCard Incorporated rose to $717 million ($5.63 per share) vs. $518 million ($3.94 per share) in the same quarter a year earlier. This marks a rise of 38.4% from the year earlier quarter.

Revenue: Rose 26.1% to $1.8 billion from the year earlier quarter.

Actual vs. Wall St. Expectations: MA beat the mean analyst estimate of $4.80 per share. It beat the average revenue estimate of $1.71 billion.

Quoting Management: “We are pleased with our strong results this quarter, which were driven by several factors including double-digit increases in volumes and processed transactions in most regions across the globe,” said Ajay Banga, MasterCard president and chief executive officer. “Debit portfolio conversions in the U.S. and new transaction processing in Brazil and the Netherlands continue to contribute to this growth. “Economic indicators across the world remain mixed, with the uncertainties in Europe and the United States weighing on sentiment and dominating headlines. Nonetheless, we continue to focus on displacing cash and winning share across markets. We will be adding to our domestic processing in Italy as we have signed a multi-year agreement with a major bank to convert their debit cards to Maestro-only from a co-brand with a domestic scheme. In the U.S., Huntington Bank recently announced a conversion to MasterCard debit cards and will be implementing our IPS platform. We also continue to work with governments around the world, most recently in India and Mexico, to replace some of their paper-based, manual procurement systems with MasterCard commercial products.”

Key Stats:

The company has now seen net income rise in three straight quarters. In the second quarter, net income rose 32.8% and in the first quarter, the figure rose 23.5%.

The company has now topped analyst estimates for the last four quarters. It beat the mark by 55 cents in the second quarter, by 19 cents in the first quarter, and by 11 cents in the fourth quarter of the last fiscal year.

Revenue has risen the past four quarters. Revenue increased 22.1% to $1.67 billion in the second quarter. The figure rose 14.8% in the first quarter from the year earlier and climbed 10.8% in the fourth quarter of the last fiscal year from the year-ago quarter.

Looking Forward: The outlook for the company’s results in the upcoming quarter is unfavorable. The average estimate for the fourth quarter is $3.92 per share, down from $3.98 ninety days ago. For the fiscal year, the average estimate has moved up from $17.07 a share to $17.70 over the last ninety days.

Competitors to Watch: Visa Inc. (NYSE:V), American Express Company (NYSE:AXP), Discover Financial Services (NYSE:DFS), Fidelity National Information Services (NYSE:FIS), JP Morgan (NYSE:JPM), Green Dot Corporation (NYSE:GDOT), Global Payments Inc. (NYSE:GPN), Wright Express Corporation (NYSE:WXS), Net one UEPS Tech., Inc. (NASDAQ:UEPS), FleetCor Tech., Inc. (NYSE:FLT), and Euronet Worldwide, Inc. (NASDAQ:EEFT).

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(Source: Xignite Financials)