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1. Company Snapshot

1.a. Company Description

Mastercard Incorporated, a technology company, provides transaction processing and other payment-related products and services in the United States and internationally.It facilitates the processing of payment transactions, including authorization, clearing, and settlement, as well as delivers other payment-related products and services.The company offers integrated products and value-added services for account holders, merchants, financial institutions, businesses, governments, and other organizations, such as programs that enable issuers to provide consumers with credits to defer payments; prepaid programs and management services; commercial credit and debit payment products and solutions; and payment products and solutions that allow its customers to access funds in deposit and other accounts.


It also provides value-added products and services comprising cyber and intelligence solutions for parties to transact, as well as proprietary insights, drawing on principled use of consumer, and merchant data services.In addition, the company offers analytics, test and learn, consulting, managed services, loyalty, processing, and payment gateway solutions for e-commerce merchants.Further, it provides open banking and digital identity platforms services.


The company offers payment solutions and services under the MasterCard, Maestro, and Cirrus.Mastercard Incorporated was founded in 1966 and is headquartered in Purchase, New York.

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1.b. Last Insights on MA

Mastercard Incorporated's recent performance was driven by robust consumer spending, particularly in travel and leisure, which lifted volumes and value-added services. The company's Q2 earnings and revenue beat estimates, with a 16% EPS growth and 16.8% year-over-year revenue growth. Additionally, management raised 2025 guidance, expecting high-teens net revenue growth and maintaining high profitability. Mastercard's payments network remains a growth engine, with Q2 revenues up 13% and a strong U.S. market share. The company's diversified revenue mix, including cross-border payments, is a key driver of future performance.

1.c. Company Highlights

2. Mastercard's Strong Q3 2025 Earnings: A Closer Look

Mastercard Incorporated reported a robust financial performance for the third quarter of 2025, with net revenues rising 15% on a non-GAAP currency-neutral basis. The company's Payment Network net revenue increased by 10%, while value-added services and solutions net revenue grew by 22%. Operating income increased 15%, and EPS was $4.38, up 11% year-over-year, beating analyst estimates of $4.32. The company's strong financial performance was driven by healthy consumer and business spending, with worldwide gross dollar volume (GDV) up 9% year-over-year, and cross-border volume up 15%.

Publication Date: Nov -01

📋 Highlights

Segment Performance

The company's Value-Added Services and Solutions (VASS) segment saw significant growth, with a 22% increase in revenue, driven by network-linked revenues, new product launches, and pricing tied to the value delivered. The underlying organic growth was approximately 19%, with 3 ppt driven by acquisitions. The Payment Network saw growth in key metrics, including domestic assessments, worldwide Gross Dollar Volume (GDV), and cross-border assessments.

Guidance and Outlook

For Q4, Mastercard expects net revenue growth to be at the high end of a low double-digits range on a currency-neutral basis, excluding acquisitions. The company assumes continued healthy consumer and business spending, with a supportive macroeconomic environment. For the full year 2025, net revenues are expected to grow at the low teens range on a currency-neutral basis, excluding acquisitions. Analysts estimate next year's revenue growth at 12.2%.

Valuation

Mastercard's current valuation metrics indicate a premium, with a P/E Ratio of 34.98, P/B Ratio of 62.94, and P/S Ratio of 15.74. The company's ROE is 196.9%, and ROIC is 44.54%, indicating strong profitability. The EV/EBITDA ratio is 26.46, and Free Cash Flow Yield is 3.43%. These metrics suggest that the company's strong financial performance is partially priced in, but its growth prospects and dominant position in the payments industry may justify the premium.

Strategic Initiatives

Mastercard continues to focus on executing against its strategic priorities, including consumer payments, commercial and new payment flows, and services. The company is making progress in opening new acceptance channels, particularly in underpenetrated verticals like rent, healthcare, and tourism. Mastercard's recent acquisition, Ethoca, provides transaction details at the moment of a chargeback to consumers, which can help prevent disputes.

Future Growth Opportunities

The company sees opportunities for growth in agentic commerce, with solutions like Mastercard Agent Pay, which certifies and registers bots. Mastercard Commerce Media brings together offers, loyalty, and personalization to provide a unique position in the market. The company's differentiated proposition and global footprint, with 27,000 bank partners, position it for continued success in the payments industry.

3. NewsRoom

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Mastercard: Premium Payments Business, But Returns Likely To Mirror The Market

Dec -04

Source: seekingalpha.com

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Mastercard: Time To Buy This Dividend Growth Titan

Dec -04

Source: seekingalpha.com

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Mastercard: A Premium Compounder You Don't Want To Underweight

Dec -04

Source: seekingalpha.com

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Mastercard: Immaculate Execution, Though Not Cheap Enough To Fully Back Up The Truck

Dec -04

Source: seekingalpha.com

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Mastercard: Rock Solid Amid Macro Jitters

Dec -03

Source: seekingalpha.com

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Mastercard: 4 Reasons Why The Stock Is A Strong Buy

Dec -03

Source: seekingalpha.com

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Mastercard Incorporated (MA) Presents at UBS Global Technology and AI Conference 2025 Transcript

Dec -02

Source: seekingalpha.com

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Beacon Pointe Advisors LLC Sells 1,969 Shares of Mastercard Incorporated $MA

Dec -02

Source: defenseworld.net

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (12.00%)

6. Segments

Payment Solutions

Expected Growth: 12.0%

The expected growth rate for Payment Solutions is aligned with the global revenue growth hypothesis of 12.0%. This is because Payment Solutions is a core segment for Mastercard, driving a significant portion of its revenue through transaction fees and other related services. The growth is supported by increasing transaction volumes and the expanding global acceptance of Mastercard-branded cards.

7. Detailed Products

Payment Processing

Mastercard provides payment processing services that enable merchants to accept various payment methods, including credit, debit, and prepaid cards, as well as digital payments.

Digital Payments

Mastercard offers digital payment solutions, such as Masterpass, that allow consumers to make online and in-app purchases using their mobile devices.

Cross-Border Payments

Mastercard facilitates cross-border payments, enabling individuals and businesses to send and receive payments across different countries and currencies.

Card Services

Mastercard provides card services, including card issuance, card processing, and card management, to financial institutions and merchants.

Data Analytics

Mastercard offers data analytics services that provide insights and intelligence to businesses, helping them to optimize their operations and improve customer experiences.

Security Solutions

Mastercard provides security solutions, such as fraud detection and prevention, to protect transactions and prevent fraudulent activities.

Loyalty and Rewards

Mastercard offers loyalty and rewards programs that enable businesses to incentivize customers and drive loyalty.

Consulting Services

Mastercard provides consulting services to businesses, helping them to optimize their payment strategies and improve operational efficiency.

8. Mastercard Incorporated's Porter Forces

Forces Ranking

Threat Of Substitutes

Mastercard's business model is highly dependent on its network effects, making it difficult for substitutes to emerge. Additionally, the company's strong brand recognition and partnerships with financial institutions further reduce the threat of substitutes.

Bargaining Power Of Customers

Mastercard's customers, primarily financial institutions, have some bargaining power due to their large transaction volumes. However, the company's diversified customer base and strong relationships mitigate this power.

Bargaining Power Of Suppliers

Mastercard's suppliers, primarily financial institutions and merchants, have limited bargaining power due to the company's dominant market position and the lack of alternative payment processing networks.

Threat Of New Entrants

The threat of new entrants is low due to the high barriers to entry in the payment processing industry, including significant capital requirements, regulatory hurdles, and the need for a large network of merchants and financial institutions.

Intensity Of Rivalry

The payment processing industry is highly competitive, with Mastercard facing intense rivalry from Visa, American Express, and other players. The company must continually innovate and invest in its products and services to maintain its market share.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 69.35%
Debt Cost 4.47%
Equity Weight 30.65%
Equity Cost 9.47%
WACC 6.00%
Leverage 226.31%

11. Quality Control: Mastercard Incorporated passed 5 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

Stock-Card
Discover

A-Score: 6.8/10

Value: 6.2

Growth: 7.8

Quality: 7.7

Yield: 3.0

Momentum: 8.5

Volatility: 7.7

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Visa

A-Score: 6.1/10

Value: 0.8

Growth: 7.8

Quality: 8.8

Yield: 1.0

Momentum: 8.0

Volatility: 10.0

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Capital One

A-Score: 5.9/10

Value: 4.4

Growth: 6.3

Quality: 6.3

Yield: 3.0

Momentum: 8.5

Volatility: 6.7

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Stock-Card
Mastercard

A-Score: 5.6/10

Value: 0.8

Growth: 7.8

Quality: 8.2

Yield: 0.0

Momentum: 7.0

Volatility: 10.0

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Amex

A-Score: 5.5/10

Value: 2.4

Growth: 6.6

Quality: 6.9

Yield: 2.0

Momentum: 7.0

Volatility: 8.0

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PayPal

A-Score: 4.8/10

Value: 5.1

Growth: 7.7

Quality: 7.3

Yield: 0.0

Momentum: 2.5

Volatility: 6.0

1-Year Total Return ->

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Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

546.28$

Current Price

546.28$

Potential

-0.00%

Expected Cash-Flows