"King of Cards" How Does Visa Make Money?

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To be honest, VISA stock is the kind of investment that really feels solid and reliable. I bought a bit of VISA a few years ago, and before I knew it, the price had climbed past $300 and I started getting those occasional dividend notifications. The dividends aren’t huge, but it’s nice to see that money coming in automatically. I can see why so many dividend investors like VISA.

VISA is, of course, the same “VISA” you see on your credit cards. Globally, they dominate the credit card market, with nearly half of the market share, and they’re among the top 10 biggest companies in the US by market cap.

These days, cashless payments have become the norm, and that trend really works in VISA’s favor. Most analysts expect VISA to keep growing steadily, with annual revenue and profit increases of around 10%. VISA has also raised its dividend every year for over 16 years, making it a classic “dividend growth” stock. The yield itself is under 1%, but the key is that the dividend keeps getting bigger.

Recently, VISA’s been expanding into new businesses too-like Visa Direct for money transfers-so they’re evolving from just a credit card company into a global payments platform. Maybe that’s why even Warren Buffett has invested in VISA.

Of course, there are risks. There’s always talk of antitrust regulation, and new fintech companies like PayPal are trying to take market share. In fact, VISA’s stock has underperformed the market a bit in the last few years. But VISA’s economic moat (the barriers that keep competitors out) is still very strong.

Looking at the current price, VISA’s P/E ratio is actually a bit lower than its five-year average, so some people think it’s undervalued right now. That’s why I think VISA is a stock you can hold in your portfolio for the long term and feel pretty comfortable about.


- VISA is the clear leader in global payments, and as we move toward a cashless society, its growth prospects look strong.
- The dividend is small but growing every year, and the stock price has trended upward over the long term.
- There are risks like regulation and fintech competition, but most still see VISA as a solid investment.

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