V - Embedded Expectations Analysis - 2018 06 08
Visa Inc. (V:USA) currently trades near historical highs relative to UAFRS-based (Uniform) Earnings, with a 28.8x Uniform P/E, implying bullish expectations for the firm. However, management has concerns about growth, Visa Direct, and their European operationsSpecifically, management may lack confidence in the sustainability of double digit growth inbound to the U.S., and may also lack confidence in the sustainability of growth across many segments of retail and across everyday spend categories. Furthermore, they may lack confidence in the sustainability of improving global traction for Visa Direct, particularly in P2P use cases, and may be exaggerating the extent to which other use cases are producing volumes through the offering. Moreover, they may be exaggerating their satisfaction with their technical migration in Europe, driven by concerns about the number of clients that have been migrated, and may be downplaying concerns about their conversion of European client contracts to commercial incentives
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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