We recently published a list of Long-Term Stock Portfolio: 15 Best Stocks for 15 Years. In this article, we are going to take a look at where Mastercard Incorporated (NYSE:MA) stands against other best stocks for 15 years.
Russell Investments believes that 3 features are defining the market outlook for 2025. These include the elevated level of the S&P 500 forward P/E ratio, the potential for further US dollar strength, as well as the direction of the US 10-year Treasury yield. The active equity managers have been challenged by the severe market concentration. The firm opines that a flattening out of such trends— which can be seen due to policy shifts or change in sentiments related to earnings growth and valuations for mega caps — can support active manager outperformance.
Russell Investments remains focused on sectors in which AI adoption has been ramping up, including industrials, healthcare, and consumer goods. As per the firm, companies that leverage AI for productivity improvements remain well-placed to gain a lasting competitive edge and provide healthy returns. Therefore, skilled active managers are required to look for such companies, primarily those that are in less-covered segments of the market.
READ ALSO: 7 Best Stocks to Buy For Long-Term and 8 Cheap Jim Cramer Stocks to Invest In.
Sectors Providing Investment Opportunities
With respect to real assets, Russell Investments sees attractive investment opportunities in real estate and infrastructure, mainly sectors that can benefit from the stabilization of long-term interest rates and favorable relative valuations in comparison to other growth assets. The application of AI in real estate, like data centers and healthcare facilities, continues to emerge as a critical growth area. Furthermore, the infrastructure investments continue to gain momentum from energy utilities and pipeline exposures, given the US administration’s emphasis on expanding LNG (liquified natural gas) production.
The firm also believes that an early focus on deregulation and tax cuts would likely be well-received by equity investors. Overall, an expected US soft landing, together with anticipated policy moderation on trade and immigration, creates specific opportunities for well-positioned portfolios, says Russell Investments.
Our Methodology
We sifted through the holdings of iShares Core S&P 500 ETF and shortlisted the companies that have 10-year revenue growth of over ~10%. Next, we selected stocks that were the most popular among elite hedge funds. We have ranked the stocks in ascending order of hedge fund sentiment.
Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 373.4% since May 2014, beating its benchmark by 218 percentage points (see more details here).
A woman using a payment terminal at the checkout of a store showing payment products and solutions.
Mastercard Incorporated (NYSE:MA)
10-year Revenue Growth: ~11.5%
Number of Hedge Fund Holders: 151
Mastercard Incorporated (NYSE:MA) is engaged in providing transaction processing and other payment-related products and services. The company has been aided by the favourable macroeconomic environment, underpinned by strong consumer spending. In the Q4 2024 earnings call, the company’s management highlighted that affluent consumers benefited from the wealth effect, with the mass segment being supported by the labor market. The global trend focused on digital payments continues to act as a tailwind for Mastercard Incorporated (NYSE:MA)’s business. With more transactions moving online and contactless payments becoming prevalent, the company remains well-placed to benefit from the secular shift.
Furthermore, emerging markets continue to provide significant opportunities for growth as they pivot from cash-based economies to digital payment systems. Mastercard Incorporated (NYSE:MA)’s global brand recognition, together with its established network, offers a healthy foundation for expansion. Through leveraging the technological expertise as well as adapting to local market conditions, Mastercard Incorporated (NYSE:MA) can tap into previously underserved populations, fueling transaction volume growth and enhancing the global footprint.
Bretton Capital Management, an investment management company, released Q4 2024 investor letter. Here is what the fund said:
“Visa and Mastercard Incorporated (NYSE:MA) kept doing their thing, increasing earnings per share by 15% and 12%, respectively, with their stocks returning 22% and 24%. We continue to closely watch the evolving payments space as it seems like everyone’s always trying to displace the card networks. For now, we don’t see anything gaining much traction.”
Overall, MA ranks 7th on our list of best stocks for 15 years. While we acknowledge the potential of MA as an investment, our conviction lies in the belief that some deeply undervalued AI stocks hold greater promise for delivering higher returns, and doing so within a shorter time frame. There is an AI stock that went up since the beginning of 2025, while popular AI stocks lost around 25%. If you are looking for a deeply undervalued AI stock that is more promising than MA but that trades at less than 5 times its earnings, check out our report about this cheapest AI stock.
READ NEXT: 20 Best AI Stocks To Buy Now and 30 Best Stocks to Buy Now According to Billionaires.
Disclosure: None. This article is originally published at Insider Monkey.
