Research Desk Line-up: Synchrony Financial Post Earnings Coverage
LONDON, UK / ACCESSWIRE / July 25, 2017 / Pro-Trader Daily has just published a free post-earnings coverage on Visa Inc. (NYSE: V), which can be viewed by registering at http://protraderdaily.com/optin/'symbol=V, following the Company's disclosure of its third fiscal 2017 earnings results on July 20, 2017. The global payments processor outperformed top- and bottom-line expectations. Our daily stock reports are accessible for free, and with those to look forward today you also will be signing up for a complimentary member's account at:
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Get more of our free earnings reports coverage from other constituents of the Credit Services industry. Pro-TD has currently selected Synchrony Financial (NYSE: SYF) for due-diligence and potential coverage as the Company announced on July 21, 2017, its financial results for Q2 2017. Register for a free membership today, and be among the early birds that get access to our report on Synchrony Financial when we publish it.
At Pro-TD, we make it our mission to bring you news that matter about the stock you follow. Today, our research desk covers a blog story on V; also brushing on SYF. With the links below you can directly download the report of your stock of interest-free of charge at:
http://protraderdaily.com/optin/'symbol=V
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Earnings Reviewed
For the quarter ended June 30, 2017, Visa's net operating revenue surged 26% to $4.57 billion compared to operating revenue of $3.63 billion in Q3 FY16, reflecting the inclusion of Europe and continued growth in payments volume, cross-border volume, and processed transactions. The Company stated that exchange rate shifts negatively impacted reported net operating revenue growth by approximately 1.5%. Visa's revenue number came in ahead of analysts' expectations of $4.36 billion.
During Q3 FY17, Visa's GAAP operating expenses totaled $1.54 billion, down 52% compared to operating expense of $3.20 billion, which included special items related to the acquisition of Visa Europe. Excluding these special items, operating expenses grew 31% on a y-o-y basis.
Visa's GAAP net income in Q3 FY17 was $2.06 billion, or $0.86 per Class A diluted share, compared to net income of $412 million, or $0.17 per class A share, in Q3 FY16. The Company's prior year's same quarter's results included several special items related to the acquisition of Visa Europe. Excluding these special items, net income and earnings per share both increased 26% on a y-o-y basis. Exchange rate shifts versus the prior year negatively impacted earnings per share growth by approximately 2%. The Company's earnings numbers exceeded Wall Street's estimates of $0.81 per share.
Key Metrics
For Q3 FY17, Visa's service revenues, which are recognized based on payments volume in the previous quarter, were $1.9 billion, reflecting an increase of 19% on a y-o-y basis. The Company's data processing revenues rose 29% on a y-o-y basis to $2.0 billion. Visa's International transaction revenues grew 45% compared to the year ago same period to $1.6 billion. Other revenues were $209 million that is flat on a y-o-y basis.
Visa's payments volume growth for the three months ended March 31, 2017, surged 38% to $1.7 trillion. Effective with the three months ended December 31, 2016, Visa's Europe co-badge volume is no longer included in reported volume. The Company's payments volume growth for the three months ended June 30, 2017, grew 38% on a y-o-y basis to $1.9 trillion.
For Q3 FY17, Visa's cross-border volume growth, on a constant dollar basis, was 147%. The Company's cross-border volume growth, on a constant dollar basis and inclusive of Europe, in Q3 FY16 was 11%. During Q3 FY17, the Company's total processed transactions, which represent transactions processed by Visa, were 28.5 billion, reflecting a 44% increase on a y-o-y basis. The Company's total processed transactions growth was 13%, inclusive of Europe in its prior year's results.
Cash Matters
As of June 30, 2017, Visa's cash, cash equivalents, and available-for-sale investment securities were $12.2 billion. During Q3 FY17, the Company repurchased 17.8 million shares of class A common stock, at an average price of $93.82 per share, using $1.7 billion of cash on hand. In the nine months ended June 30, 2017, Visa repurchased a total of 59.2 million shares of class A common stock, at an average price of $86.82 per share, using $5.1 billion of cash on hand.
The Company currently has $5.5 billion of funds available for share repurchase.
On July 17, 2017, Visa's Board of Directors declared a quarterly cash dividend of $0.165 per share of class A common stock payable on September 05, 2017, to all holders of record of the Company's common and preferred stock as of August 18, 2017.
Outlook
Visa updated its financial outlook for fiscal full-year 2017 for the following metrics. The Company is forecasting annual net revenue growth of approximately 20% on a nominal dollar basis, including approximately 2.0 ppts of negative foreign currency impact. Visa expects client incentives as a percent of gross revenues to be in the range of 20.0% to 20.5% for FY17. The Company is estimating annual diluted class A common stock earnings per share growth in the low double-digits on a GAAP nominal dollar basis and approximately 20% on an adjusted, non-GAAP nominal dollar basis.
Stock Performance
At the closing bell, on Monday, July 24, 2017, Visa's stock marginally climbed 0.77%, ending the trading session at $100.37. A total volume of 9.18 million shares has exchanged hands, which was higher than the 3-month average volume of 8.11 million shares. The Company's stock price surged 9.28% in the last three months, 22.18% in the past six months, and 25.60% in the previous twelve months. Moreover, the stock rallied 28.65% since the start of the year. The stock is trading at a PE ratio of 44.59 and has a dividend yield of 0.66%. The stock currently has a market cap of $227.96 billion.
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