Visa’s 1st-qtr profit rises 33 percent; analysts raise 2010 estimates
By APThursday, February 4, 2010
Ahead of the Bell: Analysts raise 2010 estimates
CHARLOTTE, N.C. — Shares of Visa jumped Thursday, a day after the credit card company surprised Wall Street with surging first-quarter profits.
Visa’s profit spiked 33 percent on increased revenue, even as consumers pull back sharply on spending because of fears about the economy and their jobs.
The report led a number of analysts to revise their outlook for the operator of the world’s largest retail electronic payments network.
“While the jury is still out on whether or not this is the beginning of a turn in the economy, we believe the current quarter’s results provide flexibility for 2011 in achieving 20 percent or more earnings per share growth,” Keefe, Bruyette & Woods analyst Sanjay Sakhrani wrote in a note to clients.
Sakhrani maintained his “Outperform” rating, but increased his 2010 and 2011 earnings estimates to $3.70 per share from $3.61 per share, and $4.27 per share from $4.21 per share, respectively.
He raised his share price target by $2 to $96.
Morgan Keegan analyst Robert Dodd was also upbeat on Visa Inc. He raised his 2010 estimate by 7 cents to $3.59 per share. Dodd maintained his “Outperform/Market Risk” rating on the company.
Visa’s net income rose to $763 million, or $1.02 per share, compared with $574 million, or 74 cents per share a year ago. Analysts surveyed by Thomson Reuters expected 91 cents per share on revenue of $1.92 billion, on average.
In premarket trading, Visa’s shares advanced $2.38 or 2.9 percent, to $85.90.
