3. Visa Inc. (NYSE:V)
Number of Hedge Fund Holders: 173
Number of Billionaire Investors: 24
As the metaverse evolves and virtual economies emerge, there will likely be a need for secure, efficient, and seamless payment solutions within these digital realms. Visa Inc. (NYSE:V)’s infrastructure and experience in facilitating electronic transactions could potentially be leveraged to support transactions and digital commerce within the metaverse. It is one of the top metaverse stocks preferred by billionaires.
Following Visa Inc. (NYSE:V)’s mid-quarter update on monthly fiscal Q3 operating metrics through May 28, Bank of America characterized the update as “modestly positive for shares” in light of ongoing concerns regarding consumer spending. The analyst highlighted the noteworthy metric of travel-related cross-border volume growth, excluding intra-Europe transactions, which accelerated to 139% of 2019 levels in May compared to 131% in April. The analyst maintains a positive outlook on Visa Inc. (NYSE:V), citing the company’s business model quality, resilience during economic downturns, favorable long-term trends, and a valuation that is considered reasonable. BofA reiterated a Buy rating on Visa Inc. (NYSE:V) shares and set a price target of $270.
According to Insider Monkey’s first quarter, 173 hedge funds were bullish on Visa Inc. (NYSE:V), compared to 177 funds in the prior quarter. Billionaire Chris Hohn’s TCI Fund Management is the largest stakeholder of the company, with 19.3 million shares worth $4.3 billion.
Polen Global Growth Strategy made the following comment about Visa Inc. (NYSE:V) in its Q1 2023 investor letter:
“We trimmed Mastercard and Visa Inc. (NYSE:V) to equal weights of the Portfolio. Mastercard and Visa operate as a duopoly in a large and growing market. Over the last 50 years, global personal consumer expenditures (PCE) has grown 7-9% annualized. We expect 4-5% long-term PCE growth going forward. Additionally, the shift from cash to credit continues unabated, with a total credit penetration of only approximately 50% globally.3 This shift provides Visa and Mastercard with another ~4-6% of growth. When combined with PCE, this gives both companies high-single-digit to low-double[1]digit revenue growth opportunities. This growth estimate is before accounting for growth amplifiers like the acceleration of e[1]commerce, the shift from offline to online, and additional services. Both companies enjoy extremely strong network effects that provide strong competitive advantages.
We have trimmed Visa and Mastercard because their combined weight grew to over 12% of the Global Growth Portfolio because of their recent performance and to fund our increase in Amazon’s position size. We added to both positions when their prices were depressed due to cross-border transactions deteriorating materially from the pandemic. Cross-border volumes came roaring back when travel corridors reopened, and although we are several quarters removed from the cross-border nadir, Visa still grew volumes >30% in 1Q23. Total cross-border volumes are now 132% of 2019 levels. At 4.5% each, both companies remain high conviction positions for Global Growth.”
