MasterCard Bucks the Trend
MasterCard just posted better than expected 3rd quarter earnings. In the current economic climate that’s a pretty impressive accomplishment. It was reported that net income rose 7% while revenue saw a 24% increase from the 3rd quarter of 2007.
What Does It Mean
The better than expected quarterly report means that MasterCard is showing some nice growth. Long thought of as the little sister of credit card giant Visa, MasterCard is gaining a substantial market share overseas. Global growth has been the fuel stoking the fire.
Half a trillion dollars in purchase volume has MasterCard finding itself in a pretty healthy financial position. Transactions reportedly grew 13% topping off at an impressive $5.4 billion. Asia, Africa and the Middle East saw 25% growth with Latin America close behind at 19%. The U.S. continues to languish with 7% growth.
MasterCard share prices have been cut in half in the past 6 months alone. Right now they stand at about $160 per share. It actually looks like a good buy here, but not since the great depression has the the future of financial institutions been so cloudy.
If you do plan to buy shares of MasterCard, our advice is to tread lightly. I don’t think really think there is any question that we are now facing a worldwide recession that could very well last for years. And of course, in a recession it’s the financial companies that get hit the hardest.
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