Mastercard Incorporated
Mastercard Incorporated Fundamental Analysis
Mastercard Incorporated (MA) shows moderate financial fundamentals with a PE ratio of 31.51, profit margin of 45.65%, and ROE of 1.98%. The company generates $32.6B in annual revenue with strong year-over-year growth of 12.23%.
Key Strengths
Areas of Concern
The stock receives a Fundamental Health Score of 67.4/100 based on profitability, valuation, growth, and balance sheet metrics. The C+ grade reflects average fundamentals, with notable risks in certain areas.
Fundamental Health Score
We analyze MA's fundamental strength across five key dimensions:
Efficiency Score
ExcellentMA demonstrates superior asset utilization.
Valuation Score
WeakMA trades at a premium to fair value.
Growth Score
ExcellentMA delivers strong and consistent growth momentum.
Financial Health Score
ModerateMA shows balanced financial health with some risks.
Profitability Score
ExcellentMA achieves industry-leading margins.
Key Financial Metrics
Is MA Expensive or Cheap?
P/E Ratio
MA trades at 31.51 times earnings. This suggests a premium valuation.
PEG Ratio
When adjusting for growth, MA's PEG of 5.55 indicates potential overvaluation.
Price to Book
The market values Mastercard Incorporated at 60.90 times its book value. This suggests the stock is fully valued or overvalued on an asset basis.
EV/EBITDA
Enterprise value stands at 22.85 times EBITDA. This signals the market has high growth expectations.
How Well Does MA Make Money?
Net Profit Margin
For every $100 in sales, Mastercard Incorporated keeps $45.65 as profit after all expenses.
Operating Margin
Core operations generate 59.17 in profit for every $100 in revenue, before interest and taxes.
ROE
Management delivers $1.98 in profit for every $100 of shareholder equity.
ROA
Mastercard Incorporated generates $27.64 in profit for every $100 in assets, demonstrating efficient asset deployment.
Following the Money - Real Cash Generation
Operating Cash Flow
Mastercard Incorporated generates strong operating cash flow of $17.49B, reflecting robust business health.
Free Cash Flow
Mastercard Incorporated generates strong free cash flow of $17.01B, providing ample flexibility for dividends, buybacks, or growth.
FCF Per Share
Each share generates $19.05 in free cash annually.
FCF Yield
MA converts 3.64% of its market value into free cash.
Financial Ratios Analysis
Valuation Ratios
P/E Ratio
Price to earnings ratio
31.51
vs 25 benchmark
PEG Ratio
Price/earnings to growth ratio
5.55
vs 25 benchmark
P/B Ratio
Price to book value ratio
60.90
vs 25 benchmark
P/S Ratio
Price to sales ratio
14.31
vs 25 benchmark
Financial Health
Debt/Equity
Total debt to shareholders' equity
2.45
vs 25 benchmark
Current Ratio
Current assets to current liabilities
1.03
vs 25 benchmark
Efficiency Ratios
ROE
Return on equity percentage
1.98
vs 25 benchmark
ROA
Return on assets percentage
0.28
vs 25 benchmark
ROCE
Return on capital employed
0.62
vs 25 benchmark
How MA Stacks Against Its Sector Peers
| Metric | MA Value | Sector Average | Performance |
|---|---|---|---|
| P/E Ratio | 31.51 | 18.86 | Worse (Expensive) |
| ROE | 198.42% | 847.00% | Weak |
| Net Margin | 45.65% | 4202.00% | Weak |
| Debt/Equity | 2.45 | 0.91 | Weak (High Leverage) |
| Current Ratio | 1.03 | 667.17 | Neutral |
| ROA | 27.64% | -21543.00% (disorted) | Strong |
MA outperforms its industry in 1 out of 6 key metrics, particularly excelling in ROA, but lagging in P/E Ratio.
Historical Growth Performance
5-Year Growth Trajectory
This section reviews Mastercard Incorporated's 5-year compound annual growth rate (CAGR) and compares its performance against the typical investment style of its industry.
Revenue CAGR
83.43%
Industry Style: Value, Dividend, Cyclical
High GrowthEPS CAGR
74.36%
Industry Style: Value, Dividend, Cyclical
High GrowthFCF CAGR
98.58%
Industry Style: Value, Dividend, Cyclical
High Growth