Wells Fargo’s Tech Stocks To Beat The S&P: 14 Top AI & Non-AI Stocks

6. Visa Inc. (NYSE:V)

Number of Hedge Fund Holders In Q3 2024: 165

NTM EPS Estimate: $11.21

Visa Inc. (NYSE:V) is the biggest payment processing firm in the US. The firm’s dominant position is clear through the fact that it commands 47% of all US credit card outstanding balances and 52% market share of the US credit card market. Visa Inc. (NYSE:V)’s business model depends on the health of the US consumer since the firm takes a fee out of every transaction that it processes. Consequently, the higher the consumer spending is in America, the better Visa Inc. (NYSE:V)’s business performs. Additionally, the rise of new-age financial technology companies that offer retailers and merchants alternate avenues to accept digital payments is creating fresh challenges for Visa Inc. (NYSE:V). If the firm fails to satiate merchant concerns about its platform fees, then merchants could switch platforms and reduce its market share. It has also been diversifying its business model to reduce dependence on consumer spending by introducing new revenue streams such as value-added services and expanding its presence internationally.

Visa Inc. (NYSE:V) is also facing the heat from the Justice Department for its dominant market position. Here’s what the firm’s management had to say on this front during the fiscal Q4 2024 earnings call:

“Before I close, I wanted to make a few comments on the recent lawsuit by the Department of Justice. We believe the lawsuit is meritless and shows a clear lack of understanding of the payments ecosystem in the United States.

We will defend ourselves vigorously and are confident in our ability to demonstrate that Visa competes for every transaction in a thriving debit space that continues to grow and see new entrants.”