Banking, finance, and taxes

Visa Wins Big on Big Bottom Line Beat

Chris Lange

Published: April 20, 2017 4:26 pm

Last Updated: January 12, 2020 12:48 pm

Visa Inc. (NYSE: V) reported fiscal second-quarter financial results after markets closed on Thursday. The company said that it had $0.86 in earnings per share (EPS) and $4.5 billion in revenue, versus consensus estimates from Thomson Reuters that called for $0.79 in EPS and $4.31 billion in revenue. The same period from last year had $0.68 in EPS and $3.63 billion in revenue.

Total Visa processed transactions were 26.3 billion, a 42% increase over the prior year, or 12% growth inclusive of Europe in prior year results. At the same time, payments volume growth, on a constant dollar basis, was 37% higher than in the prior year at $1.7 trillion.

In terms of the outlook for the full fiscal year, the company expects to see EPS growth in the high end of the mid-teens. The consensus estimates are calling for $3.32 in EPS and $17.79 billion in revenue for the 2017 fiscal year.

During the fiscal second quarter of 2017, Visa also completed a legal entity reorganization of Visa Europe and certain other Visa subsidiaries to align its global corporate structure to the geographic jurisdictions in which it conducts business operations.

Visa returned approximately $2.1 billion of capital to shareholders in the form of share repurchases and dividends. The board of directors authorized a new $5.0 billion repurchase program for class A common stock. On the books, cash and cash equivalents totaled $6.43 billion at the end of the quarter, versus $5.62 billion at the end of the previous fiscal year.

Alfred F. Kelly, Jr., CEO of Visa, commented:

In the face of geo-political uncertainty, Visa continues to execute well against our operating plan and strategic priorities, delivering sustained growth across nearly every part of our business. Robust growth in payments volume, cross-border volume and processed transactions drove better than expected results. Looking ahead, we are continuing our efforts across the globe to electronify commerce and digitize economies to the benefit of consumers and societies alike.

Shares of Visa closed Thursday up 1.6% at $91.15, with a consensus analyst price target of $98.48 and a 52-week trading range of $73.25 to $92.05. Following the release of the earnings report, the stock was up 2.4% at $93.35 in the after-hours trading session.