Kevin Sullivan Visa Inc. V-N BUY Oct 20, 2023

Yes, stablecoin has been weighing on Visa, but he thinks also the Middle East fighting between Iran and Israel. Airlines cancelled flights, so there was concern over credit card spending. Is down 3% today. He target $365.

Such a well-oiled machine. Dip in the chart lately. Massive amount of free cashflow, dominant position. Crucial role in move to digital payments. Still likes very much, though it's now a hold because it's above his buy price.

Average rate of return of 20% since it went public. Does take pauses, and it looks to be taking one right now. The drop looks a bit concerning, though still in a normal trading range. If it can hold above the $330 level, it's worthy of buying on this dip. Something bad happened yesterday to cause the almost 5% drop.

But you have to be very careful. You need a trading plan, which means that if it drops below $330, you sell. Solid support at $315.

Many times people have challenged or sold Visa, and every time they were wrong. They will be wrong again.

Is consolidating, just like the S&P these days. Nothing wrong with consolidating, as long as it doesn't break down. Visa's chart looks fine.

97% gross margins, and 60% operating margins. A play on global transaction volumes. Worries about stablecoins; but however people decide to pay for something, Visa will take its share. There will always be competitive threats, but its network is a backbone of payments and can't easily be replicated. Yield is 0.68%.

Largest payment processor in the world. Still lots of growth potential outside NA for transitioning from cash to digital. Value-added services, such as cybersecurity, are now almost 25% of revenue base. Robust network. Don't discount them because of stablecoin, will be actively involved.

Really high quality, but quite expensive. Great performer for a decade. More and more people are using credit cards. Concerns about different crypto currencies, but so many people still use their Visa cards.

Remains one of the best compounders out there. Has moved beyond swipe fees to value-added services; fraud tools and data analytics continuing to grow extremely quickly, now accounting for over 25% of revenue. Core business benefiting as travel rebounds. Consumer spending remains resilient. Trades at 31x forward PE, not cheap but fair.

It reports Tuesday. It always sells off after it reports, because its financials are hard to understand.