MASTERCARD INC - A (MA)
US57636Q1040 - Common Stock
MA gets a fundamental rating of 7 out of 10. The analysis compared the fundamentals against 102 industry peers in the Financial Services industry. Both the health and profitability get an excellent rating, making MA a very profitable company, without any liquidiy or solvency issues. MA shows excellent growth, but is valued quite expensive already. This makes MA very considerable for growth and quality investing!
1. Profitability
1.1 Basic Checks
In the past year MA was profitable.
MA had a positive operating cash flow in the past year.
Each year in the past 5 years MA has been profitable.
MA had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
MA's Return On Assets of 27.80% is amongst the best of the industry. MA outperforms 100.00% of its industry peers.
Looking at the Return On Equity, with a value of 163.54%, MA belongs to the top of the industry, outperforming 100.00% of the companies in the same industry.
The Return On Invested Capital of MA (48.74%) is better than 99.02% of its industry peers.
MA had an Average Return On Invested Capital over the past 3 years of 41.59%. This is significantly above the industry average of 8.00%.
The last Return On Invested Capital (48.74%) for MA is above the 3 year average (41.59%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 27.8% | ||
| ROE | 163.54% | ||
| ROIC | 48.74% |
ROA(3y)25.03%
ROA(5y)24.39%
ROE(3y)146.01%
ROE(5y)135.22%
ROIC(3y)41.59%
ROIC(5y)40.58%
1.3 Margins
With an excellent Profit Margin value of 46.09%, MA belongs to the best of the industry, outperforming 90.20% of the companies in the same industry.
In the last couple of years the Profit Margin of MA has grown nicely.
With an excellent Operating Margin value of 58.47%, MA belongs to the best of the industry, outperforming 89.22% of the companies in the same industry.
MA's Operating Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 58.47% | ||
| PM (TTM) | 46.09% | ||
| GM | N/A |
OM growth 3Y3%
OM growth 5Y0.93%
PM growth 3Y2.11%
PM growth 5Y2.62%
GM growth 3YN/A
GM growth 5YN/A
2. Health
2.1 Basic Checks
The Return on Invested Capital (ROIC) is well above the Cost of Capital (WACC), so MA is creating value.
The number of shares outstanding for MA has been reduced compared to 1 year ago.
MA has less shares outstanding than it did 5 years ago.
The debt/assets ratio for MA is higher compared to a year ago.
2.2 Solvency
MA has an Altman-Z score of 11.21. This indicates that MA is financially healthy and has little risk of bankruptcy at the moment.
Looking at the Altman-Z score, with a value of 11.21, MA belongs to the top of the industry, outperforming 96.08% of the companies in the same industry.
The Debt to FCF ratio of MA is 1.47, which is an excellent value as it means it would take MA, only 1.47 years of fcf income to pay off all of its debts.
Looking at the Debt to FCF ratio, with a value of 1.47, MA is in the better half of the industry, outperforming 76.47% of the companies in the same industry.
A Debt/Equity ratio of 1.87 is on the high side and indicates that MA has dependencies on debt financing.
MA has a worse Debt to Equity ratio (1.87) than 69.61% of its industry peers.
Although MA does not score too well on debt/equity it has very limited outstanding debt, which is well covered by the FCF. We will not put too much weight on the debt/equity number as it may be because of low equity, which could be a consequence of a share buyback program for instance. This needs to be investigated.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.87 | ||
| Debt/FCF | 1.47 | ||
| Altman-Z | 11.21 |
ROIC/WACC5.53
WACC8.81%
2.3 Liquidity
MA has a Current Ratio of 1.09. This is a normal value and indicates that MA is financially healthy and should not expect problems in meeting its short term obligations.
MA has a Current ratio of 1.09. This is comparable to the rest of the industry: MA outperforms 50.98% of its industry peers.
MA has a Quick Ratio of 1.09. This is a normal value and indicates that MA is financially healthy and should not expect problems in meeting its short term obligations.
MA has a Quick ratio of 1.09. This is comparable to the rest of the industry: MA outperforms 53.92% of its industry peers.
The current and quick ratio evaluation for MA is rather negative, while it does have excellent solvency and profitability. These ratios do not necessarly indicate liquidity issues and need to be evaluated against the specifics of the business.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.09 | ||
| Quick Ratio | 1.09 |
3. Growth
3.1 Past
The Earnings Per Share has grown by an nice 19.46% over the past year.
The Earnings Per Share has been growing by 13.57% on average over the past years. This is quite good.
Looking at the last year, MA shows a quite strong growth in Revenue. The Revenue has grown by 12.62% in the last year.
Measured over the past years, MA shows a quite strong growth in Revenue. The Revenue has been growing by 10.92% on average per year.
EPS 1Y (TTM)19.46%
EPS 3Y24%
EPS 5Y13.57%
EPS growth Q2Q18.21%
Revenue 1Y (TTM)12.62%
Revenue growth 3Y17.93%
Revenue growth 5Y10.92%
Revenue growth Q2Q10.44%
3.2 Future
MA is expected to show quite a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 16.71% yearly.
MA is expected to show quite a strong growth in Revenue. In the coming years, the Revenue will grow by 12.49% yearly.
EPS Next Y20.92%
EPS Next 2Y18.65%
EPS Next 3Y17.68%
EPS Next 5Y16.71%
Revenue Next Year12.29%
Revenue Next 2Y12.42%
Revenue Next 3Y12.49%
Revenue Next 5YN/A
3.3 Evolution
When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is stable.
4. Valuation
4.1 Price/Earnings Ratio
A Price/Earnings ratio of 36.04 indicates a quite expensive valuation of MA.
Compared to the rest of the industry, the Price/Earnings ratio of MA indicates a slightly more expensive valuation: MA is more expensive than 63.73% of the companies listed in the same industry.
MA's Price/Earnings ratio indicates a valuation a bit more expensive than the S&P500 average which is at 28.60.
The Price/Forward Earnings ratio is 26.67, which means the current valuation is very expensive for MA.
Compared to the rest of the industry, the Price/Forward Earnings ratio of MA indicates a slightly more expensive valuation: MA is more expensive than 69.61% of the companies listed in the same industry.
MA is valuated rather expensively when we compare the Price/Forward Earnings ratio to 20.15, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 36.04 | ||
| Fwd PE | 26.67 |
4.2 Price Multiples
The rest of the industry has a similar Enterprise Value to EBITDA ratio as MA.
MA's Price/Free Cash Flow is on the same level as the industry average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 40.29 | ||
| EV/EBITDA | 27.48 |
4.3 Compensation for Growth
The PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
MA has an outstanding profitability rating, which may justify a higher PE ratio.
MA's earnings are expected to grow with 17.68% in the coming years. This may justify a more expensive valuation.
PEG (NY)1.72
PEG (5Y)2.66
EPS Next 2Y18.65%
EPS Next 3Y17.68%
5. Dividend
5.1 Amount
MA has a yearly dividend return of 0.58%, which is pretty low.
Compared to an average industry Dividend Yield of 3.43, MA has a dividend in line with its industry peers.
With a Dividend Yield of 0.58, MA pays less dividend than the S&P500 average, which is at 2.32.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.58% |
5.2 History
On average, the dividend of MA grows each year by 17.92%, which is quite nice.
MA has been paying a dividend for at least 10 years, so it has a reliable track record.
MA has not decreased its dividend for at least 10 years, so it has a reliable track record of non decreasing dividend.
Dividend Growth(5Y)17.92%
Div Incr Years12
Div Non Decr Years17
5.3 Sustainability
MA pays out 18.82% of its income as dividend. This is a sustainable payout ratio.
The dividend of MA is growing, but the earnings are growing slower. This means the dividend growth is not sustainable.
DP18.82%
EPS Next 2Y18.65%
EPS Next 3Y17.68%
MASTERCARD INC - A
NYSE:MA (5/17/2024, 7:11:49 PM)
After market: 461 +0.73 (+0.16%)460.27
+1.4 (+0.31%)
Chartmill FA Rating
GICS SectorFinancials
GICS IndustryGroupFinancial Services
GICS IndustryFinancial Services
Earnings (Last)
Earnings (Next)
Inst Owners
Inst Owner Change
Ins Owners
Ins Owner Change
Market Cap427.88B
Analysts
Price Target
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.58% |
Dividend Growth(5Y)
DP
Div Incr Years
Div Non Decr Years
Ex-Date
Surprises & Revisions
EPS beat(2)
Avg EPS beat(2)
Min EPS beat(2)
Max EPS beat(2)
EPS beat(4)
Avg EPS beat(4)
Min EPS beat(4)
Max EPS beat(4)
EPS beat(8)
Avg EPS beat(8)
EPS beat(12)
Avg EPS beat(12)
EPS beat(16)
Avg EPS beat(16)
Revenue beat(2)
Avg Revenue beat(2)
Min Revenue beat(2)
Max Revenue beat(2)
Revenue beat(4)
Avg Revenue beat(4)
Min Revenue beat(4)
Max Revenue beat(4)
Revenue beat(8)
Avg Revenue beat(8)
Revenue beat(12)
Avg Revenue beat(12)
Revenue beat(16)
Avg Revenue beat(16)
PT rev (1m)
PT rev (3m)
EPS NQ rev (1m)
EPS NQ rev (3m)
EPS NY rev (1m)
EPS NY rev (3m)
Revenue NQ rev (1m)
Revenue NQ rev (3m)
Revenue NY rev (1m)
Revenue NY rev (3m)
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 36.04 | ||
| Fwd PE | 26.67 | ||
| P/S | |||
| P/FCF | |||
| P/OCF | |||
| P/B | |||
| P/tB | |||
| EV/EBITDA |
EPS(TTM)
EY
EPS(NY)
Fwd EY
FCF(TTM)
FCFY
OCF(TTM)
OCFY
SpS
BVpS
TBVpS
PEG (NY)1.72
PEG (5Y)2.66
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 27.8% | ||
| ROE | 163.54% | ||
| ROCE | |||
| ROIC | |||
| ROICexc | |||
| ROICexgc | |||
| OM | 58.47% | ||
| PM (TTM) | 46.09% | ||
| GM | N/A | ||
| FCFM |
ROA(3y)
ROA(5y)
ROE(3y)
ROE(5y)
ROIC(3y)
ROIC(5y)
ROICexc(3y)
ROICexc(5y)
ROICexgc(3y)
ROICexgc(5y)
ROCE(3y)
ROCE(5y)
ROICexcg growth 3Y
ROICexcg growth 5Y
ROICexc growth 3Y
ROICexc growth 5Y
OM growth 3Y
OM growth 5Y
PM growth 3Y
PM growth 5Y
GM growth 3Y
GM growth 5Y
F-Score
Asset Turnover0.6
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.87 | ||
| Debt/FCF | |||
| Debt/EBITDA | |||
| Cap/Depr | |||
| Cap/Sales | |||
| Interest Coverage | |||
| Cash Conversion | |||
| Profit Quality | |||
| Current Ratio | 1.09 | ||
| Quick Ratio | 1.09 | ||
| Altman-Z |
F-Score
WACC
ROIC/WACC
Cap/Depr(3y)
Cap/Depr(5y)
Cap/Sales(3y)
Cap/Sales(5y)
Profit Quality(3y)
Profit Quality(5y)
Growth
EPS 1Y (TTM)19.46%
EPS 3Y24%
EPS 5Y
EPS growth Q2Q
EPS Next Y20.92%
EPS Next 2Y
EPS Next 3Y
EPS Next 5Y
Revenue 1Y (TTM)12.62%
Revenue growth 3Y17.93%
Revenue growth 5Y
Revenue growth Q2Q
Revenue Next Year
Revenue Next 2Y
Revenue Next 3Y
Revenue Next 5Y
EBIT growth 1Y
EBIT growth 3Y
EBIT growth 5Y
EBIT Next Year
EBIT Next 3Y
EBIT Next 5Y
FCF growth 1Y
FCF growth 3Y
FCF growth 5Y
OCF growth 1Y
OCF growth 3Y
OCF growth 5Y