MW Why Visa's stock could be a better play than Mastercard's this year

By Emily Bary

Visa's more U.S.-focused business looks like an asset, according to Seaport Research

Visa Inc.'s stock has lagged Mastercard Inc.'s over five-year and 10-year spans, and it trailed in 2024 as well. But could that trend flip in 2025?

Seaport Research Partners analyst Jeff Cantwell seems to think so, as he upgraded Visa shares (V) to buy from neutral on Monday, while making the reverse move on Mastercard shares $(MA)$.

Visa, according to Cantwell, could benefit this year from its greater exposure to the U.S. "Whereas last year we liked Mastercard more on a relative basis, this year we prefer Visa's U.S.-heavy footprint and also believe that its relatively lower multiple makes the shares' risk/reward relatively more attractive," he wrote.

Cantwell is also looking ahead to Visa's investor day in February, which could be a positive driver for the stock. Mastercard, by contrast, " lacks an identifiable catalyst," he said.

On Visa, Cantwell thinks the company could benefit from a "virtuous circle" with client incentives, while noting that the company could also see upbeat demand within its value-added services category thanks to interest in cybersecurity offerings.

Read: 20 fintech companies expected to grow rapidly through 2026, including Upstart

Though he likes Mastercard's story as well, he prefers Visa on a relative basis and said that Mastercard's greater international exposure could mean more risk around spending on personal-consumption expenditures. Plus, he stock looks fully valued, in Cantwell's view.

Mastercard's stock is up 0.3% in afternoon action Tuesday, while Visa's is up 0.8%.

Shares of the two payment networks are fairly well loved by analysts. On Visa, 33 of 43 analysts covering the stock have buy ratings, according to a FactSet tally, while nine are at the equivalent of neutral and one has a sell rating. As for Mastercard, there are 37 covering analysts, with 28 at buy and nine at neutral.

Mastercard shares outperformed Visa shares in four out of the past five calendar years, according to Dow Jones Market Data.

-Emily Bary

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January 14, 2025 13:40 ET (18:40 GMT)

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