V - Embedded Expectations Analysis - 2018 02 20
ï€ Visa Inc. (V:USA) currently trades near historical highs relative to UAFRS-based (Uniform) Earnings, with a 27.2x Uniform P/E, implying fairly bullish expectations for the firm. However, management has concerns about their international operations and growth potential ï€ Specifically, management may lack confidence in PSD2 as a long-term play, and may be exaggerating the number of opportunities they have in Europe. Furthermore, they may lack confidence in their ability to reduce costs by decommissioning systems in Europe, and may be concerned about the sustainability of processed transactions growth. Moreover, they may have concerns about their ability to achieve their client incentives as a percentage of gross revenues target, and may be concerned about the sustainability of growth in India after demonetization
Visa is engaged in digital payments. The company facilitates payments between consumers and businesses. The company is focused on its proprietary network, VisaNet, to provide products and services. The company provides a portfolio of business payment solutions, including small business, corporate (travel) cards, purchasing cards, virtual cards/digital credentials, non-card cross-border business-to-business payment options and disbursement accounts, covering various main industry segments around the world. The company also provides several capabilities and services, including fraud prevention and security, processing, loyalty, merchant and digital solutions, consulting and data solutions.
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- GAAP and IFRS have failed to provide rules for reliable financial statement reporting
- Stock analyst recommendations are not grounded in disciplined financial analysis
- Credit agencies have been set up to grossly fail in their responsibilities to investors and the public markets
- Utter lack of willingness of major research firms to employ the the most advanced forensic analysis available
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- The governing accounting bodies have created more leeway for mis-estimates and mis-classifications as financials have become unwieldy and overwhelming
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