VISA INC is https://corporate.visa.com/ one of the world s leaders in digital payments.
Since early days of VISA INC in 1958, Visa has been in the business of facilitating payments between consumers and businesses. Visa focused on extending, enhancing and investing in proprietary advanced transaction processing network, VisaNet, to offer a single connection point for facilitating payment transactions to multiple endpoints through various form factors.
During fiscal year 2023, 276 billion payments and cash transactions with Visa s brand were processed by Visa or other networks, equating to an average of 757 million transactions per day. Of the 276 billion total transactions, 213 billion were processed by Visa.
Visa earns revenue by facilitating money movement across more than 200 countries and territories among a global set of consumers, merchants, financial institutions and government entities through innovative technologies.
FCFE Details of Visa INC. shown below, US$ in millions, except per share data
|
Year |
Value |
FCFE or Terminal Value |
Present Value at 13.33% |
|
0 |
FCFE0 |
21,037 |
21,037 |
|
1 |
FCFE1 |
28,189 |
18,568 |
|
2 |
FCFE2 |
36,308 |
21,960 |
|
3 |
FCFE3 |
44,895 |
24,964 |
|
4 |
FCFE4 |
53,187 |
27,245 |
|
5 |
FCFE5 |
56,378 |
28,488 |
|
5 |
Terminal Value (TV5) |
815,294 |
142,261 |
|
Intrinsic value of Visa INC. |
$554,730 |
|
Market cap of Visa INC. |
$50.552 Trillion |
|
Intrinsic value of Visa INC. common stock (per share) |
$344.55 |
|
Current share price on 11/15/2024 |
$309.64 |
Required rate of Return
Assumptions
|
Rate of return on LT Treasury Composite(Rf) |
4.36% |
|
Expected rate of return on market portfolio(E(RM) |
13.81% |
|
Systematic risk of Visa INC. Common stock (β) |
0.95 |
|
Required rate of return on Visa INC. Common Stock (r) Calculation : Rf + β(E(RM)- (Rf) = 4.36% +0.95[13.81% - 4.36%] |
13.33% |
FCFE Growth rate Forecast
Visa INC. H-Model
|
Year |
Value |
Growth Rate |
|
1 |
g1 (PRAT Model) |
34.02% |
|
2 |
g2 (Linear Interpolation) |
28.88% |
|
3 |
g3 (Linear Interpolation) |
23.65% |
|
4 |
g4 (Linear Interpolation) |
18.47% |
|
5 |
g5 (Single stage model) |
6.02% |
2023 Ratio Calculations
|
Retention rate |
78.28% |
|
Dividend yield |
0.5% |
|
Profit margin |
52.89% |
|
Asset turnover |
0.36 |
|
Return on Asset |
19% |
|
Current Ratio |
1.45 |
|
EPS |
9.72 |
|
PE Ratio |
31.86 |
Sources : Form 10K of Visa INC. for the fiscal year 2023 https://annualreport.visa.com/home/default.aspx , https://www.stock-analysis-on.net/ , https://finance.yahoo.com , https://companiesmarketcap.com/
Disclosures
This report is based on information obtained in good faith from public sources and sources believed to be reliable, but no independent verification has been made nor is its accuracy or completeness guaranteed. This report and information herein is solely for informational purpose and shall not be used or considered as an offer document or solicitation of offer to buy or sell or subscribe for securities or other financial instruments.
No comments:
Post a Comment