As the world goes cashless, payments giants Visa and Mastercard are poised for success

  • CFRA analysts forecast revenue growth for Visa and Mastercard
  • Cash still accounts for $7 trillion of global spending, but more is moving to cards
  • More layers being added to transactions, leading to increased network fees and revenue
  • Fixed network costs result in profit margin expansion for Visa and Mastercard
  • Visa and Mastercard stocks have performed well despite economic concerns
  • Inflation has little impact on revenue for Visa and Mastercard

CFRA analysts predict strong revenue growth for Visa and Mastercard as the world increasingly adopts digital payments. Cash still makes up a significant portion of global spending, but more transactions are shifting to cards. Additionally, the introduction of more layers in transactions, such as with services like Uber Eats, leads to increased network fees and revenue for Visa and Mastercard. Due to their fixed network costs, a significant portion of this revenue will translate into profit margin expansion. Despite concerns about the economy, Visa and Mastercard stocks have performed well, as their revenue is tied to spending rather than specific consumer purchases. Inflation also has minimal impact on their revenue. As the cashless revolution continues, Visa and Mastercard are well-positioned to thrive.

Public Companies: Visa (V), Mastercard (MA)
Private Companies:
Key People:

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Factuality Level: 7
Justification: The article provides information about the potential growth of revenue for Visa and Mastercard due to the increasing trend of cashless payments. It cites CFRA analysts’ forecasts and explains the reasons behind the expected growth. The article does not contain any obvious misleading information or bias. However, it lacks specific data or evidence to support the claims made by the analysts, which lowers the factuality level slightly.

Noise Level: 7
Justification: The article provides some analysis on the growth potential for Visa and Mastercard due to the shift towards cashless payments. However, it lacks evidence or data to support its claims and does not explore any potential risks or challenges that could affect the companies’ revenue growth. The article also does not provide any actionable insights or solutions for readers.

Financial Relevance: Yes
Financial Markets Impacted: Visa and Mastercard

Presence of Extreme Event: No
Nature of Extreme Event: No
Impact Rating of the Extreme Event: No
Justification: The article discusses the potential growth of revenue for Visa and Mastercard due to the increasing trend of cashless payments. It highlights the shift from cash to card payments and the additional revenue generated from transactions involving multiple parties. The article also mentions that Visa and Mastercard are largely immune to market problems and inflation. Overall, the article focuses on the positive outlook for Visa and Mastercard in the payments industry.

Reported publicly: www.marketwatch.com