Thursday, May 01, 2008

Visa's first earnings release is here -- should you buy this young ... - BloggingStocks

Posted April 28th 2008 6:00PM by Filed under: ,

(NYSE: ) reported net income for the very first clip since its initial public offering last calendar month -- and I'll wager there are a batch of you out there who are, like myself at the moment, kicking yourself for not buying the card-entity's stock!

As for the , Visa saw its grosses diminution by 50% to about $1.5 billion. Net income on an adjusted footing was $0.52 per share for the Class A common stock. Looking at the cash-flow statement, we see that hard hard cash from operating activities for the six-month period was used instead of generated, to the melody of $252 million -- last year's operational cash flowing was much better at a positive $386 million. There was a large hit on the cash-flow statement from judicial proceeding effects.

Here's my reaction to the net income -- from a pure individual-investor viewpoint, I personally don't believe the stats are so of import from this first report. Visa have got just begun its life as a stock; it have unbelievable trade name equity, and if you look at how (NYSE: ) stockholders have benefited from that company's float, I'd be surprised if something similar doesn't go on with this 1 over the adjacent couple years. Iodine meant to purchase Visa on its first twenty-four hours of trading, but I didn't; how incorrect I was. The shares closed today at $75.63, but are trading down 4% arsenic of this authorship in the post-hours. Management gave some counsel in the fourth estate release -- grosses should turn the adjacent few old age somewhere between 11% and 15%, net income per share should see solid 20% appreciation, and yearly free hard cash flowing will be at least $1 billion (this presumes that judicial proceeding reimbursements from judicial proceeding escrow are added back). I like the guidance, I like the strength of the stock, I like that people utilize Visa card game like brainsick -- I desire to watch, maybe even pray, for pullbacks on this stock.

Disclosure: I don't ain shares in any of the companies mentioned here; places can change at any time.

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