Goldman Sachs’ Top Fund Manager Stock Picks: 25 Best Overweight Stocks

5. Mastercard Incorporated (NYSE:MA)

Number of Hedge Fund Investors In Q2 2024: 142

Mutual Fund Overweight Percentage: 0.15%

Mastercard Incorporated (NYSE:MA) is the smaller of the two major payments processing companies in the US. Along with Visa, the firm controls 76% of the US credit card market share, but is quite smaller due to its 24% share compared to Visa’s 52%. This means that unlike Visa, Mastercard Incorporated (NYSE:MA) has to be on the watch out for competitors, especially as the third biggest credit card company AMEX holds 20% of the market. When it comes to maintaining market share, 2024 has been historic for Mastercard Incorporated (NYSE:MA) and Visa since the duo has agreed to a historic $35 billion in fee reductions for merchants. However, the future of the deal is unclear after a judge struck it down, and any further disappointing news could spell trouble. Another key issue that Mastercard Incorporated (NYSE:MA) has been facing is trouble with retailers who are dissatisfied with fraud liability protection for consumers. On this front, the firm is aiming to introduce the First Party Trust program that aims to shift liability protection away from merchants. The stock’s overall health depends on purchasing volumes and consumer spending strengths, with lower rates also carrying the potential to grow the credit card business.

L1 Capital mentioned Mastercard Incorporated (NYSE:MA) in its Q2 2024 investor letter. Here is what the firm said:

“The share prices of Mastercard and Visa, both long term Fund investments, have both drifted down over recent months. There have been no dramatic developments, but there has been a general slight softening in the rate of growth of consumer spending in the U.S. and globally, a court decision rejecting Mastercard and Visa’s proposed settlement of a long-lasting dispute with U.S. merchants as well as other modest adverse regulatory developments. We continue to view Mastercard and Visa as two of the highest quality businesses in the world, and both are well placed to continue to deliver attractive, risk adjusted returns to shareholders over time.”