Where Will Visa Stock Be in 5 Years?
Payment network operator Visa (NYSE: V) has beaten the market decisively since the company went public in 2008 (up 1,530% compared to 217% for the S&P 500). But it's been a different story more recently. The S&P 500 outperformed Visa over the past three years, and investors might be wondering whether the stock can regain its market-beating ways.
Looking ahead at both Visa's growth opportunities and the circumstances around the stock today should offer some insight into what investors can expect moving forward. Let's look at where Visa stock might be five years from now.
Visa stock is up about 13.1% over the past three years, compared to 23.7% for the S&P 500. Apparently, investors are not valuing the stock as much now as they did several years ago. Further proof of this investor concern can be seen in Visa's price-to-earnings ratio (P/E). Visa's ratio averaged nearly 35 over the past decade, a premium to the broader market's historical average of 16, largely because of its growth and highly profitable business model.
Source Fool.com
