Visa stock drops after disappointing earnings: Buy the dip?

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Visa posted a 20% earnings increase in its fiscal third quarter.

Key points While revenue was up 10%, it was short of analysts' estimates. Visa stock was down 3% Wednesday. Should you buy the dip? The world’s largest payment processor saw its stock price plummet after it missed revenue estimates. Stocks were tanking on Wednesday, particularly the Nasdaq, which fell some 540 points, or 3%, while the S&P 500 was down 100 points, or 1.8%. Disappointing earnings from some mega cap stocks, including Visa , likely contributed to the selloff.

, while growth in the high spend consumer segment remained stable compared to prior quarters, we saw a slight moderation in the lower spend consumer segment,” Chris Suh, Visa CFO said on the Q3 earning call. The slow down in the “lower spend” consumer category, which means moderate-to-low-income individuals, is likely due to the higher rates on credit cards, causing consumers to spend less.

 

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