Published on March 26th, 2015 | by Daily Station Team

Factors that may have an Impact on MasterCard’s (NYSE:MA) all Fourth Quarter Results

 

MasterCard’s

2014 was not a very good year for MasterCard (NYSE:MA) mainly because the company had to juggle too many issues including the Russian situation that posed a challenge to its business in that region and issues related to currencies across the globe. However despite all that the company had to deal with MasterCard (NYSE:MA) managed to pull in some impressive figures in terms of share value by the end of 2014.

As the company is all set to announce its earnings results for its fourth quarter on Friday (Today), MasterCard (NYSE:MA) investors would be hoping for a repeat of last year as far as stock value is concerned. However it may not be that easy for MasterCard (NYSE:MA) because its nemesis Visa (NYSE:V) with a strong growth in share value had a strong quarter too.

Here are a few things that can be expected from MasterCard’s (NYSE:MA) earnings report on Friday.

  • Earnings per Share or EPS for MasterCard (NYSE:MA) is expected to be $0.67, which would be 17.5% different from last year’s EPS.
  • Estimated revenue for MasterCard (NYSE:MA) is $2.39 billion

MasterCard (NYSE:MA) has been successful in beating estimates in the three of its last four quarters.

Even though its stock has been up by 12% since last year’s October, but MasterCard (NYSE:MA), in the past few months, has not been able to excite or entice its investors.

MasterCard (NYSE:MA) had a decent third quarter with a 13% surge in its revenue and an increase in EPS by 19%. Most of its revenue came from the company’s international business, which was better than its domestic business – 70% of the company’s total GDV is derived from its international market. However with the US currency strengthening and foreign currencies losing their value, MasterCard’s (NYSE:MA) business must have taken a significant hit.

Another fact that may impact MasterCard’s (NYSE:MA) quarterly results is its relatively healthier holiday season during which business from retail within the US went up by 5.5%, starting from Black Friday till Christmas.

MasterCard (NYSE:MA) has also reached an agreement with the Russian government regarding its business in the region. Sanctions imposed on Russia by the US were not reflecting well on MasterCard’s (NYSE:MA) dealings within the country; however it recently made a deal with the Bank of Russia for settling its Russian transactions.

MasterCard’s (NYSE:MA) biggest concern at the moment is Visa (NYSE:V), which continues to penetrate deeper into the market. Visa is currently involved in a deal with JPMorgan Chase’s (NYSE:JPM) that will lure the latter away from MasterCard (NYSE:MA).

The fourth quarter earnings report will show if MasterCard (NYSE:MA) would be able to sustain its growth rate along with its ability to venture into new areas. Prospects for MasterCard (NYSE:MA) look good considering the fact that 85% of all global transactions are still done using cash, which could do well for the card giant’s revenue growth.

Moreover MasterCard (NYSE:MA) is also ready to explore its digital payment options as the company recently teamed up with Apple Pay and launched its very own MasterPass back in 2013; both of these may prove to be lucrative moves in the future.


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