Visa Inc. (V)

This has very strong seasonal characteristics from around the end of January right through until early May. Technically, this is outperforming the market and has an upward trend. A lot of the other US financial service stocks have come under a lot of technical pressure in the last little while. It is kind of vulnerable, overvalued on a technical and seasonal basis. Stick with it until you start to see signs of technical weakness.

He likes this a lot. The secular shift of global payments from cash will continue, and he thinks it will continue long-term. There are lots of markets for them to get into. A lot of the world’s population is still using cash, so there is a long runway for this company. There are also huge barriers to entry for this space. Feels it is a bit overbought at this point at 68 RSI, so you might want to wait for it to come down to the 50-day moving average, at $90-$91. You will do well regardless of what price you buy that.

MasterCard (MA-N) or Visa (V-N)? Either of these would be good. They trade at multiples that are generally significantly higher than market multiples. Both companies capture the payments, and the threat of fees going down is low. MasterCard has a little more international exposure, and is a bit more advanced on the technology side, but this one is the dominant player.

Just bought Visa Europe, so it’s a more complex company now with FX and currency head/tailwinds. You are paying the same price as you would for MasterCard (MA-N), but you are getting more growth. Dividend yield of 0.7%. (Analysts’ price target is $103.)

He loves this company. It doesn’t take any credit risk. This is a toll road. If you want to use a credit card, you have to pay a toll. The great thing about this company is that it only has toll gates on about 20% of the roads in the world. It essentially has no penetration in Asia, and the potential is absolutely enormous. They are now in Europe.

This is a transition from cash and cheques to online payments, in particular in emerging markets. There are still a lot of emerging countries that are not using much in the way of credit cards. Even in North America there is still room to grow. They just acquired Visa Europe, which is expected to generate more profits going forward. She is not buying this for new clients, and is hoping to be able to get in at about $90.

He uses 2 different Stop Loss systems. One just went off today, and another one is still below price at $91.03. If it can hold the $91 range, you probably could add to this. The chart has a nice long upward trend. If it breaks the $91, you are going to have very good support at around $87. A pretty good risk/reward for something he thinks is going to go much higher in the next 8 months.

(A Top Pick Jan 27/17. Up 10%.) Reported very recently and the inclusion of Visa Europe was in that, which was somewhat of a catalyst. Moving forward, the volumes in Europe are going to increase. Thinks this is a long-term structural growth story. Still a Buy.

(A Top Pick March 23/16. Up 26%.) This, along with MasterCard (MC-N) is really taking over the world in terms of converting everyone from cash to plastic. A couple of things that are really helping are its dominance in the debit card world, and the purchase of Visa Europe. Europe is a very, very big opportunity for them. Europeans spend more of their transaction dollars in actual currency as opposed to cash.

He has no reservations as to having it in a core holding, but he missed it. You want a toll collector for financial transactions. They have a pretty substantial network. It is a financial technology company with an exceptional portfolio.

This is a long-term keeper. $4.5 billion in profit last quarter. Has owned this for 10 years, and hopes to own it for another 10. Global payments is where everybody wants to be. Had a few bumps along the way with Visa Europe, but are getting that reorganized.

Chart shows a nice long upward trend. Any time it goes back to the trend line at around $70-$79, would probably be a pretty good buy. Using his volatility charts, it shows the stock is due for a pause. Also, the MACD is sort of turning down, but that has already been reflected in the stock price. Longer-term, he has a target of $110.

This dominates the global market for electronic payments. They account for 50% of all credit card transactions globally. As consumer spending globally continues to grow, this company will take share from cash and cheques. Dividend yield of 0.74%. (Analysts price target is $98.50.)

He likes it a lot. A good technology company. They have a big transaction processing operation. They benefit from size and frequency of transaction. You hope developing countries move away from cash and to debit cards. There is a lot of runway here as they increase penetration. They and MA-T trade at a premium.

He likes the credit card processor space, although MA-N is his preference. The stocks have moved in a closely correlated move over time. V-N is more involved in the debit space where there is more pressure on fees.