Mastercard Inc.

Has done extremely well on both organic growth and on the market's re-rating. Will be beneficiaries as we move more to plastic in the post-pandemic world. Trading at a high 30s multiple, a bit extreme. Fewer opportunities and more risk in the face of Square, PayPal, and the like.

You can probably enter here if you plan to hold it for the long term. It will continue to grow. Visa has grown double digits, but Mastercard's stock has performed better. The move away from physical money will only continue and accelerate.

It has more growth than Visa, though either one is fine to buy. Lots of running room for both. Global payments is bigger than global GDP. It's such a big market. Both generate tons of free cash flow and don't need to invest a lot of capital. Fintech companies like Paypal and Square do well, but haven't replaced these two companies. Foreign exchange profits from tourists is down, but will eventually recover. (Analysts’ price target is $326.09)

V-N vs. MA-N. He is so happy to own V-N and is kicking himself for not owning MasterCard. Shopping online promotes use of credit cards. There are so many long term tailwinds that you have to own them.

MA-N vs. V-N. Own either this or V-N. We saw adoption of tap to pay. People are doing a lot more tap to pay. Buy here. He prefers V-N over MA-N.

Q1 earnings strong? He owns V instead of MA. Both are in a great position in the e-commerce space with their ability to accept digital payments. The earnings announcement by MA today were strong, but transactions were down. If it takes time to see things recover, their strong cash flow position will allow them to buy back shares and shore up their balance sheet. MA trades around 30 times earnings, so he would wait for a pullback. He thinks both MA and V may be 15% over valued right now.

MA vs. LMT Both have done well recently. MA is warning it's being affected by coronavirus. Both really good businesses. LMT can be affected by the election. If Trump gets back in, LMT will probably do pretty well. Buy LMT on weakness. For MA, it's been on a rocket for the last 5 years, and it's breaking a bit here with the warning and technical selling. So he'd wait on it, but long-term it's a good business.

Mastercard vs. Visa This sector got hit hard. MA issued a guidance warning recently, due to fewer transaction from the coronavirus. He's bought more of Visa this week, though MA is also good to add during a dip. If you add, buy in tranches, not all at once. Payments are a great space to invest. Both are good.

It's not just the coronavirus is hitting this stock. This trades at a mid-30's multiple, almost twice as expensive as 2005-6 on a valuation basis. The market sells of the high-beta stocks, which is exactly what's happening with MA as well as Visa (which he sold at $181). When do they bounce back, he doesn't know. Look elsewhere.

Mastercard is a great company that is very similar to Visa. The move towards digital payments is continuing. They both have a great global reach, both for credit and debit business. You can keep buying in on dips.