Mastercard: Long-Term Rockstar With Short-Term Headwinds

Summary:

  • Mastercard is an operating margins champion, delivering stellar top-line growth with a strong tailwind represented by a secular shift to electronic payments.
  • I consider current valuation fair since multiples are below the company’s historical averages but I do not see that possible recession priced in.
  • The company is well-positioned to continue to benefit from favorable secular trend, but short-term challenges in the macroenvironment might undermine the stock price.
Mastercard Credit Card

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Investment thesis

I like Mastercard’s (NYSE:MA) long-term stellar financial performance and the company’s management’s striving toward innovation and expansion of shareholder value, but in the short term there is very much uncertainty regarding developed economies’ Central Banks’ further interest rates tightening


Disclosure: I/we have no stock, option or similar derivative position in any of the companies mentioned, and no plans to initiate any such positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.


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