2024-04-04 11:39:58 ET
Summary
- Visa Inc. and Mastercard Incorporated are among the highest quality, non-cyclical businesses money can buy today.
- Benefiting from ever-increasing M2 supply, move towards a cashless society and elevated inflation, both businesses are expected to continue growing quickly.
- The low dividend yield is well compensated for by the double-digit DGR and the yield on cost could be over 3% in 10 years' time.
- Given the quality, both trade at a premium valuation, yet Visa offers better risk-adjusted ROI even with lower forward EPS growth.
Are you looking for a dividend growth company to add to your portfolio?
You do not need to look much further than the two payment processing companies, Visa Inc. ( V ) and Mastercard Incorporated ( MA ).
Both of the companies are among the highest quality businesses that money can buy today with non-cyclical, resilient business models, benefiting from tailwinds such as ever-increasing M2 supply and move towards a cashless society.
While the yield for each of these companies is <1%, the DGR well compensates for the lack of yield for investors which are willing to wait. The dividends are expected to grow at around 10% to 15% annually over the next decade and the yield on cost in 10 years may be >3% or higher....
Read the full article on Seeking Alpha
For further details see:
Why Visa Could Be A Better Investment Than Mastercard