Fly Intel: What to watch in credit card space earnings reports

American Express (AXP), Visa (V) and MasterCard (MA) are scheduled to announced quarterly results on April 23, 27 and 29, respectively. What to watch for:

1. INTRA-QUARTER METRICS: Barclays analyst Ramsey El-Assal raised the firm’s price target on Visa to $250 from $230, while keeping an Overweight rating on the shares ahead of the company’s first quarter results. Intra-quarter metrics show some moderation in February, while macro and cross-border continues to improve, El-Assal told investors in a research note. The analyst has optimism around the vaccine rollout and resumption of consumer spending. El-Assal also raised his price target on MasterCard to $402 from $380, maintaining an Overweight rating on the shares ahead of the company’s quarterly results. Intra-quarter spend data has been impacted by external factors but is “still solid,” El-Assal added. Meanwhile, Wells Fargo analyst Donald Fandetti raised the firm’s price target on American Express to $165 from $150 and kept an Overweight rating on the shares. The analyst believes American Express shares will rally further when incremental data points show strong pent-up demand for U.S. T&E spend. Once pent-up spend kicks in, Fandetti expects to see positive earnings revisions for 2022 and management boosting guidance.

2. CARD FEES HIKE DELAYED: Visa and MasterCard are postponing plans to boost the fees U.S. merchants pay when consumers use credit cards online, pushing back the changes another year to April 2022 because of the pandemic, Bloomberg’s Jennifer Surane reported. Retailers have been asking both networks in recent months to delay hikes in so-called interchange fees, hoping to avoid a jump in costs for accepting cards at a time when consumers are especially reliant on online shopping, the author noted.

3. CRYPTO SUPPORT: Back in February, MasterCard said in a blog post that it would start supporting select cryptocurrencies directly on its network. “This is a big change that will require a lot of work,” MasterCard said. “We will be very thoughtful about which assets we support based on our principles for digital currencies, which focus on consumer protections and compliance. Our philosophy on cryptocurrencies is straightforward: It’s about choice. Mastercard isn’t here to recommend you start using cryptocurrencies. But we are here to enable customers, merchants and businesses to move digital value.”

4. ANTITRUST PROBE: The Justice Department’s antitrust division is investigating whether Visa is engaging in anticompetitive practices in the debit-card market by limiting merchants’ ability to route debit-card transactions over networks that are often less expensive, according to The Wall Street Journal’s AnnaMaria Andriotis and Brent Kendall, citing people familiar with the matter.

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