New York (Business Emerge), July 25: Visa’s recent third-quarter revenue report has led several brokerages to lower their price targets for the company, raising alarms about a potential slowdown in consumer spending and impacting the broader U.S. payments sector.
The reported figures highlight ongoing difficulties within the industry, which has previously enjoyed several quarters of growth. Inflation and elevated borrowing costs have prompted many consumers to reduce their expenditures, compounded by a slowdown in wage increases.
Additionally, Visa indicated a reduction in U.S. payment volumes during the initial three weeks of July. This decline has been attributed to multiple factors, including a recent outage associated with CrowdStrike.
In response to these developments, Visa’s stock price dropped nearly 4% to $254.13, erasing gains made earlier this year. At least nine major Wall Street brokerages have adjusted their price targets for Visa’s shares downward.
Analysts at Jefferies noted, “We do not foresee a favorable shift in the current narrative. Although the present valuation may present a good entry point, we are uncertain about any immediate catalysts.”
Raymond James also commented, “We anticipate that Visa’s shares may remain relatively stable over the coming months until more clarity emerges regarding the FY25 outlook.”
Meanwhile, shares of Mastercard fell by 2.5%, and PayPal Holdings and Block experienced declines of 1% and 2.6%, respectively. Visa also reported a deceleration in payment volumes within the Asia Pacific region, particularly in China, where a prolonged property crisis and weakened business sentiment have dampened economic activity.