Mastercard Inc (MA): A Fast Growing Credit Card Company

Peers Comparison

MasterCard, with $2.43 trillion in total payments volume and more than 1 billion issued cards, is the second biggest card company in the world. The global leading position belongs to Visa Inc (NYSE: V), which processed nearly $3.77 trillion payments volume and issued 2.1 billion cards. American Express Company (NYSE: AXP) and Discover Financial Services (NYSE: DFS) ranked third and fourth, respectively. American Express has issued 97 million cards and processed $808 billion in payments volume, while Discover Financial issued 59 million cards and processed $114 billion payments. At the current trading price of $520 per share, MasterCard is worth more than $64.2 billion in the market. The market is valuing MasterCard at more than 17.24x forward P/E. Visa, with nearly $107 billion in market cap, is valued a bit more expensive, at 19x forward P/E. Discover Financial seems to be the cheapest among the four, with only 8.75x forward earnings valuation, while the forward P/E of American Express is 11.3x.

Foolish Takeaway

Visa and MasterCard are benefiting from the growing cashless transaction trend. There is still a lot of growth for both companies in emerging markets globally. Investors might surf the global trend towards cashless transactions by initiating long positions in both companies.

The article A Fast Growing Credit Card Company originally appeared on Fool.com and is written by Anh HOANG.