Mastercard beats the Street in third quarter on strong U.S. consumer spending
Cashless transaction giant Mastercard reported third quarter earnings this week that beat the Street’s predictions. In outperforming for the three months ending in September, Mastercard joins peers Visa and PayPal (also held in Dominion’s Global Trends Ecommerce Fund) – both of which saw similar success. The driving force behind this barrage of positive performance? Strong U.S. consumer spending, which surged through the quarter.
Mastercard’s share price has risen by 23% so far this year
Source: Yahoo Finance
For the third quarter of 2018, Mastercard reported adjusted earnings of $1.78 per share. This is an easy beat against Wall Street’s predictions of $1.68 per share, and converts to a 33% increase against the same period in 2017. Group sales rose by 15%, year on year, to $3.9 billion. Also reported against the year-ago quarter, gross dollar volumes were up by 13%, and purchase volumes increased 15%.
The company’s CEO, Ajay Banga, made the following comment over the results, highlights the success Mastercard is having when it comes to partnering with banks and merchants:
"We had another very strong quarter, delivering solid top- and bottom-line growth. Our business wins and new partnerships, strengthened by our differentiated services offerings, are helping drive our global momentum. We are continuing to invest for the long term with a focus on secure and convenient solutions that will help us grow our core business and address new payment flows."
As U.S. consumer spending grew by 0.4% in September, and August’s figure was revised to 0.5%, Mastercard is seeing successes similar to Visa and PayPal. With employment at its lowest level in the country since 1969, and August alone seeing U.S. pay-per-hour expand by 2.96% (the largest monthly expansion in 9 years), the U.S. is currently looking very rosy for payment providers.
Dominion holds Mastercard, as well as PayPal and Visa, in its Global Trends Ecommerce Fund.
If you would you like to receive the Newsfeeds daily, please click here to sign up now!Help us make this Newsfeed better by rating this article. 1 star = Poor and 5 stars = Excellent
- Click here to print this story: Print
The views expressed in this article are those of the author at the date of publication and not necessarily those of Dominion Fund Management Limited. The content of this article is not intended as investment advice and will not be updated after publication. Images, video, quotations from literature and any such material which may be subject to copyright is reproduced in whole or in part in this article on the basis of Fair use as applied to news reporting and journalistic comment on events.