2. Visa Inc (NYSE:V)
Number of Hedge Fund Investors: 167
Strong dividend growth history and share price growth upside potential makes Visa Inc (NYSE:V) one of the best long-term dividend stocks to buy and hold.
Earlier this month, Visa Inc (NYSE:V) posted fiscal first quarter results, according to which its adjusted EPS came in at $2.41, beating estimates by $0.07. Revenue in the quarter jumped 8.9% year over year to $8.6 billion, surpassing estimates by $50 million.
Visa Inc (NYSE:V) in its latest earnings call talked about dividends, buybacks and future expectations:
“In Q1, we bought back approximately $3.4 billion in stock and distributed over $1 billion in dividends to our stockholders. At the end of December, we had $26.4 billion remaining in our buyback authorization. Now let’s move to what we’ve seen so far in January through to the 21st. U.S. payment volume was up 4% with debit up 3% and credit up 4% year-over-year, down from December, largely due to severe weather conditions in parts of the U.S. Process transactions grew 8% year-over-year. Constant dollar cross-border volume, excluding transactions within Europe, grew 16% year-over-year. Travel-related cross-border volume, excluding intra-Europe, grew 16% year-over-year or 146% indexed to 2019; and cross-border card-not-present ex travel grew 16%.
Now on to our expectations. Remember that adjusted basis is defined as non-GAAP results in constant dollar and excluding acquisition impacts. You can review these disclosures in our earnings presentation for more detail. For the full year, we have no material changes to our prior outlook for drivers, adjusted net revenues or EPS growth. Remember that our drivers assume no recession or a further increase in Reg II impacts. Pismo is expected to have minimal benefit to full year net revenue growth and an approximately 0.5 point headwind to non-GAAP operating expense and EPS growth. FX is expected to have an approximately 0.5 point drag to net revenues growth and approximately 1 point benefit to non-GAAP operating expense growth and a minimal drag to non-GAAP EPS growth.
Non-GAAP non-operating income is expected to be between $350 million and $400 million, with nearly half in Q2 due to the resolution of some non-U.S. tax matters.”
Read the full earnings call transcript here.
In its October 2023 investor letter, Lakehouse Capital stated the following regarding Visa Inc. (NYSE:V):
“Visa Inc. (NYSE:V) reported a strong result with net revenue increasing 11% year-on-year to $8.6 billion and non-GAAP earnings per share increasing by 21% to $2.33. As has been the case for many years now, the scalable nature of the business allows for revenue growth to outpace its costs, which places the company in a good position to navigate through this inflationary period. The network continues to grow, with credentials and merchant locations up 7% and 17%, respectively. Cross-border travel-related spend also maintained its robust growth, increasing 26% year-on-year while Visa Direct reported 7.5 billion transactions, up 19% yearon-year, progressing on penetrating categories such as cross-border remittances. Altogether, we’re pleased with how the business is tracking and remain positive on Visa’s outlook.”
