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Globe and Mail
09-07-2025
- Business
- Globe and Mail
Fees, Fines & Gains: Mastercard's 13% 3-Month Rise Laughs at Headlines
Shares of Mastercard Incorporated MA have climbed 12.7% over the past three months, outperforming the broader market, including key rival Visa Inc. V, despite facing considerable headwinds. Over the same period, the broader industry rose 10.1%, while Visa gained 9.2%. However, American Express AXP stood out with a 28.4% surge, benefiting from strong consumer sentiment and travel-related spending. Meanwhile, the S&P 500 rose 18.2%, driven largely by tech-sector momentum. Price Performance – MA, V, AXP, Industry & S&P 500 Mastercard Navigating Through Legal, Regulatory & Competitive Turbulence Mastercard's recent growth may look effortless on the surface, but it is happening against a backdrop of mounting regulatory and legal pressure. At the center of it all are the interchange and network fees, which are core to Mastercard's revenue model. In the U.K., a tribunal recently ruled that Mastercardand Visa's interchange fees breach European competition laws,paving the way for potential regulatory caps. Also, the U.K.'s Payment Systems Regulator will likely introduce fee limits, posing a risk to revenue growth in the region. In the United States, the Department of Justice previously accused Mastercard and Visa of leveraging their dominance to overcharge merchants. Proposed legislation, the Credit Card Competition Act, could intensify pricing pressure and force routing alternatives that disrupt Mastercard's pricing power. Although U.S. banks have pushed back, urging Congress to reject the bill, regulatory scrutiny remains high. Mastercard resolved a workplace pay bias case in early 2025, committing to internal audits. Late last year, it settled a major London lawsuit over card fees. But regulation is not the only threat. Mastercard is also fending off growing competition from agile fintechs and alternative payment rails. Big Tech and retailers like Amazon and Walmart are exploring stablecoin-based settlement systems that could bypass Mastercard entirely. In this shifting landscape, the company's continued rally signals strong investor confidence, but sustaining that momentum will require more than just weathering lawsuits. It will mean evolving fast enough to stay ahead of a rapidly changing payment future. Mastercard Is Embracing Stablecoins Rather than resisting change, Mastercard is preparing to integrate stablecoins into its ecosystem. While stablecoins offer advantages like faster settlements and lower costs, especially in cross-border transactions, they still lack critical consumer benefits such as credit access, fraud protection and rewards. These areas remain Mastercard's stronghold. Moreover, Mastercard is already taking proactive steps and developing crypto-friendly products. Its Multi-Token Network and pilot programs using USDC for settlements show it is exploring blockchain-powered payment infrastructure. Past innovations like mobile wallets did not replace card networks but expanded them, and Mastercard appears poised to ensure the same happens with stablecoins and crypto. Both Mastercard and Visa are racing to adapt stablecoins, reportedly valued at roughly $253 billion. Their aim: integrate digital currency capabilities while preserving their core transaction networks. Premium Valuation Reflects Strong Investor Confidence Mastercard continues to command a valuation premium, signaling enduring investor trust. Based on forward earnings, the company trades at a P/E ratio of 32.32X, well above the industry average of 22.87X. Visa's forward P/E stands at 28.51X, while American Express trails at 19.44X. Image Source: Zacks Investment Research Mastercard's Growth Levers Remain Intact Mastercard is strengthening its competitive position through increased merchant engagement, improved customer experience, and expanded digital capabilities. Tokenized transactions, for example, offer higher approval rates and lower fraud, boosting transaction volume and enhancing trust among financial institutions and retailers. Its Value-Added Services have been a key growth engine, with revenues rising 17.7% in 2023, 16.8% in 2024, and another 16% in the first quarter of 2025. The company is also pursuing targeted acquisitions and partnerships to expand service offerings and fortify cybersecurity. Meanwhile, strong cash generation supports buybacks, dividends and strategic investments. In the first quarter, Mastercard generated $2.4 billion in operating cash flow, up from $1.7 billion a year ago. It repurchased 4.7 million shares for $2.5 billion and distributed $694 million in dividends during the quarter. Strong 2025 & 2026 Estimates for Mastercard Analyst sentiment remains positive. The Zacks Consensus Estimate for Mastercard's EPS indicates growth of 9.5% in 2025 and 16.6% in 2026. Revenues are expected to rise 13.1% and 11.9%, respectively. The stock has seen one upward earnings estimate revision over the past month, against no movement in the opposite direction. (See the Zacks Earnings Calendar to stay ahead of market-making news.) The company has also outperformed earnings expectations in each of the last four quarters, delivering an average earnings surprise of 3.7%. Buy the Strength in Mastercard Despite facing regulatory pressure, legal challenges and rising competition from fintechs and alternative payment platforms, Mastercard has demonstrated remarkable resilience. Its ability to innovate, expand value-added services, and adapt to disruptive forces like stablecoins reinforces its long-term growth story. The company's strong financial performance, premium valuation and steady earnings revisions all signal continued investor confidence. With solid fundamentals, a forward-looking innovation strategy and favorable earnings momentum, Mastercard is well-positioned to navigate the current headwinds. Given these strengths, Mastercard carries a Zacks Rank #2 (Buy), making it an attractive pick for investors seeking exposure to a high-quality, future-ready payments leader. You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here. 5 Stocks Set to Double Each was handpicked by a Zacks expert as the #1 favorite stock to gain +100% or more in the coming year. While not all picks can be winners, previous recommendations have soared +112%, +171%, +209% and +232%. Most of the stocks in this report are flying under Wall Street radar, which provides a great opportunity to get in on the ground floor. Today, See These 5 Potential Home Runs >> Click to get this free report Mastercard Incorporated (MA): Free Stock Analysis Report Visa Inc. (V): Free Stock Analysis Report American Express Company (AXP): Free Stock Analysis Report
Yahoo
17-06-2025
- Business
- Yahoo
Credit card bill crusade persists
This story was originally published on Payments Dive. To receive daily news and insights, subscribe to our free daily Payments Dive newsletter. Sens. Roger Marshall and Dick Durbin failed last week to inch their Credit Card Competition Act legislation forward by means of the GENIUS Stablecoin. They had sought to attach an amendment with their CCCA language to the stablecoin bill in an effort to have a larger piece of legislation take their stalled proposal across the finish line in Congress. Instead, a battle royal – pitting retail and merchant interests against those of banks and card networks – is set to continue as the senators take aim at fees charged every time a consumer swipes a credit card. Retailers, restaurants and other merchants argue the fees are an undue and costly burden for stores and restaurants. To ease that expense, the senators contend their bill would inject competition into an industry dominated by Visa and Mastercard by requiring bank card issuers to make an alternative network available. That would be a mistake in the view of bank card issuers and the card networks that argue these fees pay for needed security and popular loyalty programs. In an interview last week, Richard Hunt, the executive chairman of the Electronic Payments Coalition, called out the irony of attaching the CCCA language to a stablecoin framework bill, noting that the cryptocurrency would introduce the competition for cards that Marshall and Durbin crave. It smacks of double-speak when the merchant camp suggests stablecoins are a new payment possibility, but still contend cards need more competition, he said. That sentiment draws attention to the swarm of new digital payments rivals have sprung up over the past two decades since a predecessor to PayPal Holdings was founded in 1998, and more recently with the ascent of Apple Pay and Google Pay. Presumably, those new options have swamped cards with more competition. But that's not necessarily the case, partly because many of those new digital tools still connect to credit cards, buttressing the position of big card issuers, such as JPMorgan Chase and Capital One, as well as the networks, namely the dominant players, Visa and Mastercard. The strength of the card fortress was demonstrated by an Atlanta Federal Reserve Bank report last month presenting survey results that showed credit cards were consumers' preferred payment option 35% of the time. It also showed the credit card share expanding more than other methods. Durbin, a Democrat from Illinois, and Marshall, a Republican from Kansas, say they're pushing their bill on behalf of big and small merchants, arguing that credit card fees often eat up a significant portion of businesses' slim margins. Groups representing merchants, including NACS, aka the National Association of Convenience Stores, made clear last week that they'll keep pushing to pass the CCCA provisions. Marshall has taken the lead recently on an effort started by decades ago by Durbin, who has said he won't seek re-election. 'The banks have been so overly aggressive in advertising against him in Kansas, and doing some other things, that they made it a top priority for him,' NACS General Counsel Doug Kantor said of Marshall in an interview last week. 'They made him angry.' Spokespeople for Durbin and Marshall have declined to comment, but the Merchants Payments Coalition said the latest CCCA campaign brought a 'surge of support.' Whether or not stablecoins ever become a true threat to cards remains to be seen. One industry consultant, Peter Tapling, says they have the potential to challenge cards, but he doesn't see them as a threat to Visa or Mastercard at the moment. Tapling points to Paze, the Early Warning Services digital wallet that's struggled to get traction, as evidence of how difficult it is to lure consumers and merchants to new forms of payment. It's always the chicken-egg problem – will consumers demand to use it enough for merchants to adopt it or will merchants make it available enough that consumers gravitate to it, he said in an interview Friday. Back in Washington, Kantor says CCCA supporters are already hunting for the next piece of legislation capable of carrying the bill to passage. Recommended Reading Walmart, Kroger eye instant payments Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data


The Hill
11-06-2025
- Business
- The Hill
Stablecoin bill clears another hurdle in Senate, inching toward final vote
The Senate voted Wednesday to advance legislation setting up a regulatory framework for payment stablecoins, bringing the crypto bill one step closer to a final vote in the upper chamber. Seventeen Democrats voted with almost every Republican to end debate on an updated version of the GENIUS Act. The new bill text was reached as part of lengthy negotiations between Republicans and crypto-friendly Democrats last month, ahead of an earlier procedural vote on the Senate floor last month. The vote breakdown was largely similar to the May vote, although Sen. Lisa Blunt Rochester (D-Del.) switched her vote to oppose the measure. She had supported the bill both in the Senate Banking Committee in March and on the Senate floor last month. Blunt Rochester voiced some hesitation Tuesday about Senate leadership's decision to forgo an open amendment process on the GENIUS Act, emphasizing that she hoped to see additional changes to the bill. 'I was really clear,' she told The Hill. 'I hoped that there would be an open amendment process, and that's what I heard Leader Thune say around last month, so I will take a look at this language, and we'll make a decision from there.' Senate Majority Leader John Thune (R-S.D.) ultimately scrapped the push for so-called 'regular order,' as controversial amendments — most notably, Sen. Roger Marshall's (R-Kan.) Credit Card Competition Act — threatened to upend support for the bill. The decision to move forward without an open amendments process frustrates a push by several Democrats to add in a provision that would prevent President Trump and other elected officials from profiting off stablecoins. 'The GENIUS act attempts to set up some guardrails for buying and selling a type of cryptocurrency, one type called a stablecoin,' Sen. Jeff Merkley (D-Ore.) said on the Senate floor ahead of Wednesday's vote. 'Well, we need guardrails that ensure that government officials aren't openly asking people to buy their coins in order to increase their personal profit or their family's profit,' he continued. 'Where are those guardrails in this bill? They're completely, totally absent.' However, crypto-friendly Democrats who have been deeply involved in negotiations are urging their colleagues to support the bill despite some of its shortcomings. 'It's extremely unhelpful that we have a president who's involved in this industry, and I would love to ban this activity, but that does not diminish the excellent work of this legislation,' Sen. Kirsten Gillibrand (D-N.Y.) said Wednesday. 'It does not diminish the hard work that bipartisan group of senators put into this to make a difference and to write a law that can protect consumers, that can protect our financial services industry, that can protect the strength of the dollar, and that can protect people who would like access to capital,' she added. The GENIUS Act likely faces a handful more votes before it can clear the Senate and head to the House. Sen. Cynthia Lummis (R-Wyo.) told The Hill on Tuesday that she expects a final vote on the bill next week.
Yahoo
11-06-2025
- Business
- Yahoo
Senate lines up major step toward passing stablecoin bill
The Senate is poised to hold another key procedural vote on stablecoin legislation Wednesday, clearing the way for the crypto bill after several controversial amendments threatened to complicate its path forward. Senate Majority Leader John Thune (R-S.D.) moved to end debate Monday on the updated text of the GENIUS Act, struck as part of a bipartisan agreement after two weeks of frantic negotiations last month between Republicans and crypto-friendly Democrats. The move appears to end Thune's push to pass the bill via so-called 'regular order,' which would have opened up floor proceedings on the stablecoin legislation to dozens of amendments in a lengthy process that risked derailing final passage. 'I think at this point it's a good thing, because the longer it sat around, the more people picked at it, and it would have died from death by 1000 cuts, if we would have waited longer,' Sen. Cynthia Lummis (R-Wyo.) told The Hill on Tuesday. 'And I think that Sen. Thune was seeing that, and so he decided to move forward just with the changes that were made in negotiations with the Democrats,' she continued, noting that she expects the updated text to be the final version of the bill. A Senate aide said Tuesday that no final decision had been made yet on amendments but underscored that the timeframe was shrinking ahead of Wednesday's vote. A key point of contention has been the Credit Card Competition Act (CCCA), which Sen. Roger Marshall (R-Kan.) offered up as an amendment. However, it seems increasingly unlikely that the bill will get a vote as part of the GENIUS Act. 'There's a couple of GOP Senators who wish to avoid a vote on CCCA at all costs, and an open amendment process on this was a major threat to that end,' a senior GOP staffer familiar with what transpired told The Hill. 'Obviously, Leader Thune ran the calculus, and ultimately decided to toss the process out in order to move on Genius,' they continued. 'There's very little Senator Marshall can do at this point, disappointed as he likely is.' The CCCA seeks to take aim at credit card swipe fees — the fees charged to retailers every time a customer swipes a credit card. Marshall and his Democratic co-sponsor, Sen. Dick Durbin (Ill.), have argued Visa and Mastercard have a duopoly over the credit card market, leading to higher swipe fees. Their proposal would require large financial institutions to provide an option other than Visa or Mastercard to process credit card transactions. The legislation has been the subject of fierce lobbying. While retailers have embraced the bill, the credit card industry has aggressively opposed the measure, arguing it would enrich major retailers and force credit card companies to do away with popular rewards programs. 'The Credit Card Competition Act has been controversial for a while in D.C.,' said Christopher Niebuhr, a senior research analyst at Beacon Policy Advisors. 'The inclusion of the Credit Card Competition Act as an amendment, were it to get an amendment vote, would certainly add a little bit of risk or uncertainty as to the path forward for the GENIUS Act,' he added. Lummis suggested Tuesday part of the push to include other measures in the stablecoin bill stems from a lack of movement on legislation in the Senate Banking Committee over the years. 'This is the first bill that's been reported out of the Banking Committee in eight years,' she said. 'So, there was a lot of pent-up desire to append other legislation that was financial services related to this bill. Some of that legislation is kind of controversial, so I get it.' 'I get why people are frustrated that they haven't had an opportunity to have their financial service related legislation heard,' she continued. 'But there will be other legislation that will come out of the Banking Committee, so they'll have other chances.' While some GOP senators may be breathing a sigh of relief, the decision to move forward on the GENIUS Act without an open amendment process is raising questions for some Democrats, including those who initially supported the bill with the hopes of making changes down the line. 'I was glad about some of the bipartisan progress that had been made,' Sen. Lisa Blunt Rochester (D-Del.) told The Hill. 'It was one of the reasons I voted the bill out of committee in the first place, was with the agreement that there would be amendments.' Blunt Rochester was one of five Democrats who joined their Republican colleague to vote the legislation out of the Senate Banking Committee in March. She and 15 other Democrats also supported the GENIUS Act in a procedural vote on the Senate floor last month. However, she noted at the time that she wanted to see further changes to protect consumers and the stability of the financial system, as well as to prevent fraud and address President Trump's growing ties to the crypto industry. 'I was really clear,' Blunt Rochester added Tuesday. 'I hoped that there would be an open amendment process, and that's what I heard Leader Thune say around last month, so I will take a look at this language, and we'll make a decision from there.' Thune repeatedly emphasized last month that he planned to move the GENIUS Act through the Senate via 'regular order,' allowing for an open amendment process on the floor. This was central to his criticism of Democrats, who initially blocked the legislation from moving forward on the Senate floor in early May. When Thune first sought to expedite the stablecoin bill, a contingent of crypto-friendly Democrats pulled their support, alleging Republicans had prematurely cut off negotiations and ultimately voting down a motion to advance the bill. The Senate majority leader slammed Democrats at the time, arguing they would have a chance to make changes on the floor. 'All they had to do was vote for cloture. Not every bill that comes to the floor is a final bill. Now, that might be how it worked when they were in control, but Republicans are doing it differently,' Thune said in early May. Sen. Elizabeth Warren (D-Mass.), a fierce crypto critic who has opposed the bill, warned Tuesday that limiting amendments could undermine support for the legislation. 'Sen. Thune has repeatedly promised that he would open up the legislative process for amendments, and this is his first chance to do that, and he's gone back on his promise,' Warren told The Hill. 'It is possible that there will be people who will say that they voted to advance the bill, but without amendments, they can't do that anymore,' she added. However, lead Democratic negotiators on the GENIUS Act have underscored the wins they secured through discussions Republicans. 'I think we have worked hard to incorporate many of the concerns that we have heard from our colleagues,' Sen. Angela Alsobrooks (D-Md.) told The Hill on Tuesday, adding, 'We had many, many amendments along the way that have been incorporated. Always we would like to have more, but it was a really solidly bipartisan effort.' Copyright 2025 Nexstar Media, Inc. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.


The Hill
11-06-2025
- Business
- The Hill
Senate lines up major step toward passing stablecoin bill
The Senate is poised to hold another key procedural vote on stablecoin legislation Wednesday, clearing the way for the crypto bill after several controversial amendments threatened to complicate its path forward. Senate Majority Leader John Thune (R-S.D.) moved to end debate Monday on the updated text of the GENIUS Act, struck as part of a bipartisan agreement after two weeks of frantic negotiations last month between Republicans and crypto-friendly Democrats. The move appears to end Thune's push to pass the bill via so-called 'regular order,' which would have opened up floor proceedings on the stablecoin legislation to dozens of amendments in a lengthy process that risked derailing final passage. 'I think at this point it's a good thing, because the longer it sat around, the more people picked at it, and it would have died from death by 1000 cuts, if we would have waited longer,' Sen. Cynthia Lummis (R-Wyo.) told The Hill on Tuesday. 'And I think that Sen. Thune was seeing that, and so he decided to move forward just with the changes that were made in negotiations with the Democrats,' she continued, noting that she expects the updated text to be the final version of the bill. A Senate aide said Tuesday that no final decision had been made yet on amendments but underscored that the timeframe was shrinking ahead of Wednesday's vote. A key point of contention has been the Credit Card Competition Act (CCCA), which Sen. Roger Marshall (R-Kan.) offered up as an amendment. However, it seems increasingly unlikely that the bill will get a vote as part of the GENIUS Act. 'There's a couple of GOP Senators who wish to avoid a vote on CCCA at all costs, and an open amendment process on this was a major threat to that end,' a senior GOP staffer familiar with what transpired told The Hill. 'Obviously, Leader Thune ran the calculus, and ultimately decided to toss the process out in order to move on Genius,' they continued. 'There's very little Senator Marshall can do at this point, disappointed as he likely is.' The CCCA seeks to take aim at credit card swipe fees — the fees charged to retailers every time a customer swipes a credit card. Marshall and his Democratic co-sponsor, Sen. Dick Durbin (Ill.), have argued Visa and Mastercard have a duopoly over the credit card market, leading to higher swipe fees. Their proposal would require large financial institutions to provide an option other than Visa or Mastercard to process credit card transactions. The legislation has been the subject of fierce lobbying. While retailers have embraced the bill, the credit card industry has aggressively opposed the measure, arguing it would enrich major retailers and force credit card companies to do away with popular rewards programs. 'The Credit Card Competition Act has been controversial for a while in D.C.,' said Christopher Niebuhr, a senior research analyst at Beacon Policy Advisors. 'The inclusion of the Credit Card Competition Act as an amendment, were it to get an amendment vote, would certainly add a little bit of risk or uncertainty as to the path forward for the GENIUS Act,' he added. Lummis suggested Tuesday part of the push to include other measures in the stablecoin bill stems from a lack of movement on legislation in the Senate Banking Committee over the years. 'This is the first bill that's been reported out of the Banking Committee in eight years,' she said. 'So, there was a lot of pent-up desire to append other legislation that was financial services related to this bill. Some of that legislation is kind of controversial, so I get it.' 'I get why people are frustrated that they haven't had an opportunity to have their financial service related legislation heard,' she continued. 'But there will be other legislation that will come out of the Banking Committee, so they'll have other chances.' While some GOP senators may be breathing a sigh of relief, the decision to move forward on the GENIUS Act without an open amendment process is raising questions for some Democrats, including those who initially supported the bill with the hopes of making changes down the line. 'I was glad about some of the bipartisan progress that had been made,' Sen. Lisa Blunt Rochester (D-Del.) told The Hill. 'It was one of the reasons I voted the bill out of committee in the first place, was with the agreement that there would be amendments.' Blunt Rochester was one of five Democrats who joined their Republican colleague to vote the legislation out of the Senate Banking Committee in March. She and 15 other Democrats also supported the GENIUS Act in a procedural vote on the Senate floor last month. However, she noted at the time that she wanted to see further changes to protect consumers and the stability of the financial system, as well as to prevent fraud and address President Trump's growing ties to the crypto industry. 'I was really clear,' Blunt Rochester added Tuesday. 'I hoped that there would be an open amendment process, and that's what I heard Leader Thune say around last month, so I will take a look at this language, and we'll make a decision from there.' Thune repeatedly emphasized last month that he planned to move the GENIUS Act through the Senate via 'regular order,' allowing for an open amendment process on the floor. This was central to his criticism of Democrats, who initially blocked the legislation from moving forward on the Senate floor in early May. When Thune first sought to expedite the stablecoin bill, a contingent of crypto-friendly Democrats pulled their support, alleging Republicans had prematurely cut off negotiations and ultimately voting down a motion to advance the bill. The Senate majority leader slammed Democrats at the time, arguing they would have a chance to make changes on the floor. 'All they had to do was vote for cloture. Not every bill that comes to the floor is a final bill. Now, that might be how it worked when they were in control, but Republicans are doing it differently,' Thune said in early May. Sen. Elizabeth Warren (D-Mass.), a fierce crypto critic who has opposed the bill, warned Tuesday that limiting amendments could undermine support for the legislation. 'Sen. Thune has repeatedly promised that he would open up the legislative process for amendments, and this is his first chance to do that, and he's gone back on his promise,' Warren told The Hill. 'It is possible that there will be people who will say that they voted to advance the bill, but without amendments, they can't do that anymore,' she added. However, lead Democratic negotiators on the GENIUS Act have underscored the wins they secured through discussions Republicans. 'I think we have worked hard to incorporate many of the concerns that we have heard from our colleagues,' Sen. Angela Alsobrooks (D-Md.) told The Hill on Tuesday, adding, 'We had many, many amendments along the way that have been incorporated. Always we would like to have more, but it was a really solidly bipartisan effort.'