Core Insights - Visa is a leading payment processor, facilitating a significant volume of transactions and benefiting from the shift towards digital payments [2][6][10] Group 1: Company Overview - Visa is primarily known as a payment processor, providing technology for safe credit and debit card transactions [2] - The company operates in a market characterized by an oligopoly, sharing dominance with a few other firms [6] Group 2: Financial Performance - In the fiscal third quarter of 2025, Visa's payment volume increased by 10% year over year, handling 65.4 billion transactions [4] - Revenue rose by 14% and adjusted earnings jumped by 23% in the same quarter [7] Group 3: Market Position and Valuation - Visa's price-to-sales (P/S) ratio is around 16.8x, slightly below its five-year average of 17.7x, while the price-to-earnings (P/E) ratio is 33.5x, compared to a longer-term average of 34.1x [8] - The current valuation suggests that while Visa is not cheap, it is reasonably priced for growth-oriented investors [9][10]

Visa can operate with such strong margins because it has already set up its nearly ubiquitous global payment network. Additional transactions don't meaningfully increase its cost of goods sold. In short, Visa has an excellent business that has performed exceptionally well in the past. That's no guarantee of future success, but there are good reasons to expect Visa to continue along the same path. In 2018, Apple became the first publicly traded company to have a $1 trillion market cap. Since then, several mo ...