Mastercard Q1 revenue beats on payment network growth

Overview

• Global payments network's Q1 revenue grew 16%, beating analyst expectations

• Adjusted EPS for Q1 beat analyst expectations

• Company repurchased 7.8 mln shares during Q1

Outlook

• Mastercard did not provide specific guidance or forecasts for the current quarter or full year in its press release

Result Drivers

• PAYMENT NETWORK GROWTH - Co said Q1 revenue growth was driven by increases in gross dollar volume, cross-border volume, and switched transactions

• VALUE-ADDED SERVICES - Co said value-added services and solutions revenue grew 22%, driven by security solutions, authentication, business insights, and pricing

• HIGHER OPERATING EXPENSES - Co said operating expenses rose 13% due to higher general and administrative costs, including a restructuring charge

Key Details

Analyst Coverage

• The current average analyst rating on the shares is "buy" and the breakdown of recommendations is 38 "strong buy" or "buy", 4 "hold" and no "sell" or "strong sell"

• The average consensus recommendation for the online services peer group is "buy"

• Wall Street's median 12-month price target for Mastercard Inc is $660.00, about 25.7% above its April 29 closing price of $525.23

• The stock recently traded at 25 times the next 12-month earnings vs. a P/E of 30 three months ago

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