MasterCard initiated with a Neutral, $525 target at Compass Point

As previously reported, Compass Point analyst Dominick Gabriele initiated coverage of MasterCard (MA) with a Neutral rating and $525 price target. The firm’s FY25 EPS estimate of $16.41 is below consensus by 1.5% due to less margin expansion, notes the analyst. In a new value added services, or VAS, analysis, the firm quantifies Visa’s (V) potential total revenue contribution if it penetrates VAS from their current 24.3% to MasterCard’s 34.3%, says the analyst. The firm believes Visa and MasterCard’s long-term revenue growth rates are 11% and 13%, respectively, with about 5% of this growth due to VAS.