Banking, finance, and taxes

Why MasterCard Investors Liked Q1 Earnings Beat

Chris Lange

Published: January 29, 2016 10:50 am

Last Updated: January 13, 2020 1:55 pm

MasterCard Inc. (NYSE: MA) reported its fiscal first-quarter financial results after the markets closed Thursday. The company had $0.79 in earnings per share (EPS) on $2.5 billion in revenue, which compares to consensus estimates from Thomson Reuters of $0.69 in EPS on revenue of $2.55 billion. The same period from the previous year had $0.69 in EPS on $2.42 billion in revenue.

During the quarter, there was a 12% increase in gross dollar volume, on a local currency basis, to $1.2 trillion. Also there was an increase in processed transaction of 12% to $13 billion and an increase in cross-border volumes of 12%.

During the fourth quarter of 2015, MasterCard repurchased approximately 8 million shares of common stock at a cost of $793 million. Quarter to date, through January 22, the company repurchased an additional 3.1 million shares at a cost of $283 million, with $4.2 billion remaining under current repurchase program authorizations.

Ajay Banga, president and CEO, MasterCard, said:

Despite a challenging economy, we were able to deliver solid results for the quarter and the full year in 2015. Entering 2016, while uncertainty in the global economy persists, the fundamentals of our business and our approach remain unchanged. We continue to be laser focused on our strategy to lead payment innovation in an increasingly digital world with solutions such as MasterPass, while growing the use of electronic payments through our products, partnerships and increased acceptance at the point-of-sale.

Shares of MasterCard traded at $86.83, up about 4%, with a consensus analyst price target of $110.88 and a 52-week trading range of $74.61 to $101.76.