Where Will Visa Stock Be In 10 Years?

Visa's Historical Performance and Growth - Visa's stock rallied nearly 380% over the past 10 years, outperforming the S&P 500's 190% rise [1] - Revenue grew at a CAGR of 11% from fiscal 2014 to fiscal 2024, while EPS grew at a CAGR of 16% during the same period [3] - The company bought back more than a fifth of its shares over the past decade [12] Visa's Business Model and Market Position - Visa partners with banks and financial institutions to issue Visa-branded cards but does not issue cards or handle accounts directly [2] - The company charges a swipe fee of 1.5%-3.5% per transaction, splitting fees with card issuers and keeping the rest as revenue [14] - Visa and Mastercard hold a near-duopoly in card-payment networks, with most businesses willing to pay swipe fees to reach more customers [9] Future Growth Projections - Analysts expect Visa's revenue and EPS to grow at a CAGR of 10% and 13%, respectively, from fiscal 2024 to fiscal 2027 [12] - The global credit card payments market is projected to grow at a CAGR of 8.8% from 2023 to 2032 [12] - Assuming stable growth and a forward P/E ratio of 28, Visa's stock could rally 145% to $784 per share over the next decade [6] Competitive and Regulatory Challenges - Visa faces competition from "buy now, pay later" platforms like Affirm, which target younger and lower-income consumers [4] - Regulatory pressure to reduce swipe fees persists, with a preliminary deal to cut fees by at least four basis points over three years being rejected by a U.S. judge in June [11] - Platforms like PayPal, Zelle, and the Fed's FedNow system could erode Visa's market share by offering alternatives to card-based payments [16] Macroeconomic and Industry Headwinds - Inflationary pressures and the Federal Reserve's outlook for fewer rate cuts in 2025 could impact consumer spending [10] - Despite challenges, Visa is expected to remain synonymous with card-based payments, with the secular growth of the market driving its stock higher over the next decade [17]