Mastercard Inc. (MA)

Prefers is a little better over Visa (V-N), which has to integrate Visa Europe. MasterCard is more exposed in the Third World, and as incomes grow and as electronic transaction usage is lower, you have growth in both income and electronic usage in the Third World. Trading at a 27X multiple. Target price of $112.

(A Top Pick Dec 22/15. Down 2.32%.) A transaction story where they make a little bit every time somebody swipes. In Europe, you have to process transactions within the country, making it more fragmented. They are trying to increase competition in Europe into a single payment area, which would give this company and Visa (V-N) more share. Also, we are having a real demographic shift. People who use paper and cheques are not spending as much. Dividend yield of 0.80%.

Transaction driven and doesn’t take any credit risks. Both Visa (V-N) and this company are strong and consistent growers, and trade at a premium to the market. This is less debit card oriented and more credit card oriented. More domestic where Visa is more international. Prefers Visa which has metrics which he believes are somewhat better. (See Top Picks.)

If you have owned this, you have made out like a bandit over the last few years. Something like a 30% compounded return. This does not have a credit risk; it is purely processing. Prefers this over Visa (V-N). Also, pays a small dividend.

(Top Pick Oct 6/15, Down 7.48%) Chinese growth is slowing. It has done well and he would stick with it. The business model is intact and Tap is working for them.

MasterCard (MA-N) or Visa (V-N)? Visa is a bit of a bigger company, and the question is really going to come down as to how they manage their currency globally. He understands that Visa is a better play if the US$ continues to rise, and this one is better if it starts to decline. That is splitting hairs, but if he had to decide between the 2, he would probably go with Visa because of its dominance in size.

Visa or MasterCard? He would never own these because he is a value investor. Both are high multiple stocks and highly correlated to consumer spending.

Highly cash generative. He really likes this business. Also, China is a potential, and entry there should be a 2016 event. Dividend yield of 0.78%.

This stock has a great chart. Generally speaking the trend line has been in place with a series of higher highs and higher lows. This looks very, very good and you are good to go.

The whole payment business is very attractive. Had some short-term headwinds, but overall they are growing. They are growing globally and one of the few growth areas in finances. (See Top Picks.)

This is on his list. If we have a severe correction, he would be adding it. It is above his model price of $69.12, a -32% differential. If you have this one, he would still hold it.

Looking at this and Visa (V-N) on a pure group basis, his choice would be Visa.

Visa (V-N) or MasterCard (MA-N)? She likes this whole space and likes both companies, but only owns Visa. There is a secular transition to electronic payments. There is a lot of growth going forward, especially in emerging markets. Her preference right now is Visa, but you could put money in both names with a little bit more into Visa.

(A Top Pick Oct 6/15. Up 5.49%.) He is a big fan of this. They are a little more indexed to Europe. Broad-based stimulus is going to drive consumer spending. With the “tap and go” they are really leveraging that small ticket purchase. Every time you tap, they make a little bit of money. Phenomenal business going forward. There is still room to go.

He likes the valuation gap here. A little more low hanging fruit on the cost side. It is a well run company. It is all flowing through an existing network. The best advent is the ‘tap’ to make payment. They are going to capture a huge share with this. He thinks it is a long time before a watch can replace a credit card. You are converting purchasers to tap right now.