WATCH: Stock pick — Mastercard
Steven Schultz from Momentum chose Mastercard as his stock pick of the day.
He said the company was sitting at “pretty hefty valuations at this stage, with a price-earnings ratio of 40, but investors should please close your ears”.
“It is certainly not an attractive one nor does it appear to be from a pure valuation perspective,” he said.
But the company works hand in hand with online shopping, so the more people move to online transactions, the better it will do.
“Visa and Mastercard] account for about 80% of online transaction processing in the US. Mastercard is by far the more attractive of the two as it is currently in a bit of a price war in Europe with Visa and is succeeding at lowering prices, and attracting new customers.
“I think if you buy into the age of internet, [this] is one that you should have in your portfolio” said Schultz.
Steven Schultz from Momentum talks to Business Day TV about Mastercard, his stock pick of the day
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