Kevin O’Leary’s Stock Portfolio: 15 Stock Picks for 2025

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7. Mastercard Incorporated (NYSE:MA)

Number of Hedge Fund Holders: 131

Mastercard Incorporated (NYSE:MA) is one of the world’s largest payment processors, thriving in digital and cross-border payments, maintaining strong operating margins, and benefiting from increased travel. The company operates in more than 200 countries and accepts transactions in over 150 currencies.

Mastercard’s revenue increased 13% year-over-year in Q3 2024, owing to strong consumer spending and improved global macroeconomic conditions. In addition, travel-related and overall spending continues to grow, as evidenced by a 10% YoY increase in gross dollar volume and a 17% YoY increase in cross-border volumes. The company’s value-added services revenue increased by 18%, outpacing overall growth, while operating margins increased to 59.3%, resulting in a 16% increase in EPS.

Earlier in December, Goldman Sachs reduced MasterCard’s price target to $557 from $563, maintaining a Buy rating on the stock. According to the firm, the MA stock has increased 18% since the election, alongside other higher beta growth names with pro-cyclical exposure outperforming the market. Goldman believes fintech will benefit from a stronger economy and inflation, as well as many of the potential policy changes under the new administration. However, in the face of higher valuations and limited visibility of fundamental acceleration, it stated that it prefers “to be a bit more selective.”

Qualivian Investment Partners stated the following regarding Mastercard Incorporated (NYSE:MA) in its Q3 2024 investor letter:

“Mastercard Incorporated (NYSE:MA): Q2 2024 revenues and EPS beat consensus expectations, growing 11% (+13% on a constant currency, CC, basis) and 24% (+27% on a CC basis) respectively. Overall payments volume increased 9%, with highly profitable cross-border volumes growing 17%. Management qualified their expectations for a solid FY2024 anchored around continued stable consumer spending, while noting there is uncertainty regarding the overall macroeconomic backdrop heading into the back half of 2024 and 2025. In the event of a weakening consumer, management noted they would adjust investment priorities as well as the company’s cost structure as appropriate if trends softened further. We continue to expect that over the longer term, MA will continue to drive and benefit from the digitization of payments globally.”

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