MA - Mastercard: Still Poised To Beat The Market Despite 32x P/E

2024-05-22 11:30:23 ET

Summary

• Mastercard stock now trades at a high P/E ratio of 32.18x, significantly higher than the sector median and the overall market.
• However, MA is still well positioned to deliver marketing-beating returns in the years to come despite its current valuation premium.
• Analysts expect strong EPS growth for MA, which could lead to a decline in the P/E ratio rapidly.
• Once the growth potential and consistency (plus the financial strength) are factored in, it's a textbook GARP opportunity (growth at a reasonable price).

MA stock trades at 32x P/E

Mastercard ( MA ) shares have rallied strongly in the past 1~2 years thanks to its stellar results. The stock recently reached an all-time high of around $530. The price has come down by about 14% since then and hovers around $460 as of this writing. Despite the correction, the current stock price still translates into an elevated P/E ratio of 32.18x as seen in the chart below (on an FWD basis)....

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