Mastercard Inc. (MA) Stock: Is the Next Target $420.00?

• MA stock fell 1.89% in a month and 1.88% in three months but rallied 12.69% YTD. 
• Mastercard recently bought minority shares of MTN Group. 

Mastercard Inc. (NYSE: MA) agreed to purchase a minority stake in Africa’s MTN Group for $5.2 Billion, while MA stock gained 12.69% YTD. MTN Group is Africa’s largest cell phone provider, and the deal is under due diligence. Moreover, its peer Visa Inc. (NYSE: V), down by 0.23% at $239.29, is under investigation by the US Department of Justice for allegedly charging retailers more for not using Visa’s proprietary tokenization technology. 

Mastercard Inc. (NYSE: MA) – Financial Analysis

Mastercard’s sales growth in the quarter ending on June 30 was 9.09%, while in the previous quarter, it was negative 1.05%. Cost of Goods Sold (COGS) growth has been 0.52% in the recent quarter, while in the last quarter, it was 3.80%. Gross profit margin swelled by 96.01%. 

The net income growth comes at 20.50% in Q2, while in Q1, it was minus 6.50%. Capital expenditure growth in Q2 was 33.81%, and capital expenditure sales fell by 3.71%. The cash and short-term investment were $7.11 Billion, while their growth fell by 5.98%. Overall the financials look promising, hinting toward considerable growth. 

Masterard Inc. (NYSE: MA) – Technical Analysis

MA stock, at press time, is trading at $394.37, falling 0.02%; previous close and open were at $394.45 and $939.44, respectively. The 52-week range is from $276.87 to $405.19, hinting a strong momentum could create new highs. With an average volume of 2.74 Million shares, the market cap is $373.716 Billion. 

The trailing twelve months (TTM) price-to-earnings (P/E) ratio is 39.36, indicating a high-valued stock price. At the same time, the (TTM) earnings per share (EPS) is $10.02, showcasing strength. Analysts placed a 2.94 rating for moderate buy and estimated a price target at $438.54 with an 11.2% upside. 

Mastercars released Q2 earnings on July 27, 2023, where the reported revenue of $6.269 Billion surpassed the expected value of $6.176 Billion by 1.50%. 

At the same time, the reported earnings of $2.89 per share also exceeded the estimated value of $2.832 per share by 2.06%. Despite these positive earnings, the MA share price fell by 4% around the announcement. 

Compared to the previous quarter, revenue gained 14.04%, while EPS is up by 12.89%. The subsequent earnings will be released on October 31, 2023, where the revenue is expected to be $6.538 Billion and earnings to be around $3.217. The operating expenses jumped by 12.11% to $2.59 Billion, while the operating margin is 43.37%. 

The (TTM) revenue is $23.59 Billion, and the year-over-year (YoY) quarterly revenue growth is 14.00%. Net income gained 25.05% to $2.85 Billion, the net profit margin swelled by 9.64% to 45.38, and the profit margin is 43.37%. 

Mastercard Inc. stock gained 1.03% in a week and 12.69% YTD but fell 1.88% in three months. 

Mastercard Inc. (NYSE: MA) – Candle Exploration

Mastercard Inc. stock price action has been bullish since March 2023 as denoted by the ascending trendline. The current price action has reached price exhaustion, indicating that the moment is either slowing down or on the verge of a trend reversal. 

Ascending 200EMA and 50EMA hints toward a price jump. The momentum shall continue as long as the price is above the trendline. This could cause the MA price to cross the $450 barrier. If the price falls below the trendline, negative momentum is likely.  

Disclaimer:

The views and opinions stated by the author, or any people named in this article, are for informational purposes only and do not establish financial, investment, or other advice. Investing in or trading crypto assets comes with stocks with a financial loss risk.