MA - MasterCard Inc - Over the past three quarters, MA’s average margin of surprise was 55.0%

MasterCard Incorporated (MA) topped analysts’ earnings expectations over the past three quarters by an average margin of 55%. Consensus estimates have jumped over the past two months. On Feb 9, the Board of Directors declared a 66.7% boost in its quarterly cash dividend to 15 cents per share from nine cents. MA’s return on equity tops that of the industry average—23% compared to 16%. Full Analysis MasterCard Incorporated, along with its subsidiaries, is a global payment solutions company that provides a variety of services in support of the credit, debit and related payment programs of nearly 25,000 financial institutions worldwide. Since MA became a publicly-traded company on May 25, 2006, the company has beat analysts’ earnings expectations every quarter. Over the past three quarters, MA’s average margin of surprise was 55.0%. Before going public, the company spent four decades as a private entity. On Feb 9, MA posted fourth-quarter earnings per share of 31 cents, crushing the Street’s estimate of 14 cents by 121.4%. Revenues increased 17.2% to $839 million from $716 million a year earlier. MA processed $532 billion in global transactions, which amounted to a 14% jump from the prior-year period. The company issued 817 million MasterCard-branded cards as of Dec 31, up 12% from the year-ago period. Consensus earnings estimates for this quarter and next are up three cents and two cents, respectively, over the past 60 days. Profit forecasts for this year and next jumped 11 cents and 16 cents, respectively, over the past two months. Earnings per share are projected to grow 16.3% over the next 3-5 years. MA is scheduled to release its first-quarter results on May 2. In addition to releasing impressive fourth-quarter results, MA declared a 66.7% boost in its quarterly cash dividend to 15 cents per share from nine cents. The dividend will be paid on May 10 to stockholders of record as of Apr 9. Chief Financial Officer Chris A. McWilton stated, "We are pleased that the success of our business and the strength of our capital position has allowed us to increase our dividend, further demonstrating our commitment to drive shareholder value." MA has a current dividend yield of 0.55%. On Apr 10, the Board approved a $500-million Class A share repurchase program. MA will also convert 13.4 million Class B shares into Class A shares on a 1-for-1 basis. MA’s return on equity, a common measure of profitability, tops that of the industry average—23% compared to 16%. MA is a Zacks #2 Rank (Buy) stock. Zacks #2 Rank stocks have generated an average annual return of 21.6% since 1988. Because the Zacks Rank has a market cap bias, Growth & Income investors may find a greater number of large-cap stocks by considering both Zacks #1 Rank (Strong Buy) and Zacks #2 Rank (Buy) stocks in their selection criteria. Content Courtesy: Zacks Investment Research #1 Ranked Stocks Highlight Archive To truly take advantage of the Zacks Rank, you need to first understand how it works. That is why we created the free special report: Zacks Rank Guide: Harnessing the Power of Earnings Estimate Revisions. | Blog Home| VitalStocks Home