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By Renee O'Farrell

Credit card company MasterCard (NYSE:MA) reported its quarterly performance on May 2. The company's EPS swelled almost 25% compared to the same period last year, coming in at $5.36 and beating analyst estimates of $5.28. The increase was powered by an increase in the number of shoppers in Latin America, the Asia Pacific and the Middle East and the company's recent acquisitions of international processing system DataCash and global prepaid card manager Access Prepaid Worldwide.

MasterCard CEO Ajay Banga said:

We had a good start to the year with solid first quarter results driven by an increase in processed transactions, the highest quarterly growth rate since our IPO, as well as positive volume growth in all regions as consumers continue to adopt electronic payments. We are leveraging opportunities around the world. In the U.S., we have significantly improved our position in debit and now have the capability to process transactions on about half of all U.S. debit cards.

The company also has a lot of hedge fund interest, including from some of the top fund managers in the world. Andreas Halvorsen's Viking Global had almost $426.32 million in the company at the end of December after upping its stake by 50% during the fourth quarter (check out Viking Global's top picks). Tom Russo's Gardner Russo & Gardner, Chase Coleman's Tiger Global Management Llc and Jean-Marie Eveillard's First Eagle Investment Management are also fans of the company.

In spite of all the positives, shares in MasterCard still fell that day because investors were expecting stronger performance. According to Barclays, "MasterCard shares rose 5.9% in the week leading up to earnings, as analysts predicted a strong quarter." Barclays analyst Darrin Peller explained the phenomenon, saying that, as a result, the higher expectations were already priced in. However, that doesn't mean that MasterCard is a bad pick. In fact, investor bearishness dragging the price down is actually a good thing for those buying in right now.

MasterCard went from almost $456 a share at the close of trading on May 1 to $440 on May 2. Last year, the company earned $18.70 a share, beating analyst consensus estimates of $18.58. Analysts are expecting MasterCard to earn $22.01 a share this year, rising to $25.91 a share next year. At this rate, the company is priced at roughly 16.98 times its future earnings. MasterCard's forward price to earnings ratio is marginally on pace with the rest of its industry, which averages 17.09 - but, I think this is a relatively low rate given its high expected growth and analyst expectations of its earnings growth, especially when looking at the competition.

Rival Visa (NYSE:V) is currently trading at $122 a share. Analysts are expecting strong growth for this company too. They expect the company will earn $5.98 a share this year, rising to $7.00 a share next year, which makes its forward price to earnings ratio 17.43 - a slight premium to its industry.

American Express (NYSE:AXP), which recently traded at $61 a share, is priced lower at almost 13 times its forward earnings but it doesn't have nearly the estimated growth of Visa and MasterCard. Analysts expect American Express will earn $4.33 a share this year, rising to just $4.79 next year. The future is even more bleak for rival Discover (NYSE:DFS). It is trading at $34 a share. Analysts are expecting its earnings to fall from $4.06 a share last year to $3.97 a share this year, dropping to $3.83 a share next year.

Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.