This is the second part of our article titled 10 Best Technology Stocks to Buy Now. We discussed why technology sector is the best place to look for long-term winners as well as how we determined the best stocks within this sector in the first part. You can read the first part of this article here.
5. VISA INC (V)
American international financial services company Visa Inc. (V) is headquartered in Foster City, California. It enables electronic money transfers all across the world, most frequently using Visa-branded prepaid, debit, and credit cards. Visa Inc’s 2022 Q2 average shareholder price is $206.76 and has a market cap of $445 billion.
Visa Inc had a net revenues of $28 billion over the last 12 months. One of the main revenue drivers for Visa Inc is consumer payments, new payments, and value added services. Visa inc is digitizing its consumer payments. Moreover, the pandemic affected consumer choices and actions. People started to use mobile payments for transactions more. Now people are using technology to make the smallest to biggest transactions. Based on the 2021 Visa Annual Report, tap to pay now is 70 percent of the in-person transactions, beside the United States. Visa is keeping investing in resources that support its growth levers, its network of networks capabilities, and the larger payments ecosystem.
Visa Inc has a P/E ratio of 31. It is one of those stocks that never trade at a cheap multiple The risk factors of investing in Visa Inc, include regulatory risks, Litigation Risks, Technology. Cybersecurity, and Structural & Organizational Risks. Visa can face barriers of reimbursement rates, domestic processing requirements, point-of-sale transaction rules and more by regulation. Moreover, global payment technology is intensive. There are numerous payment providers on the internet that are evolving payments such as fintech and other companies.
Visa Inc’s goals for inclusive, and sustainable economic growth is to empower SMBs through digital enablement, capacity-building and partnerships, expand access to digital payments for the unbanked and underserved. Furthermore, protecting the planetContinue sourcing 100 percent renewable electricity, maintaining LEED or other green-building certification, continuing to improve energy efficiency.
Here is what Polen Global Growth Fund has to say about Visa Inc. (NYSE:V) in its Q1 2022 investor letter:
“We added to both Visa and Mastercard during the final quarters of 2021, based on the belief that both businesses were trading at attractive prices and poised to deliver, double-digit returns over the next three to five years. Cross-border transactions–a highly profitable business segment for both companies–represent roughly 10% of Visa and Mastercard’s volumes and 25% of their gross revenues, so lockdowns have severely impacted this segment due to stifled travel. While it was impossible to know when people would begin traveling again, we accepted this reality with the belief that travel would eventually return. Both companies have commented that as soon as a country or geography reopens, cross-border volumes reignite, amplifying each business’s growth and profitability. We think these near- term headwinds have created an attractive long-term investment opportunity.”