Imminent Visa IPO Tantalizes Investors

Investors and the financial community are gearing up for a steady stream of IPOs in 2008. One company that is generating quite a bit of anticipation and excitement is Visa, an expected rival to Mastercard (MA). According to a recent Reuters article:

The company said late on Friday its plans to list the shares on the New York Stock Exchange under the symbol "V" V.N, according to an amended registration statement with the U.S. Securities and Exchange Commission. It has not disclosed how many shares it will offer, or the expected price.

"It will certainly do well, as MasterCard has done incredibly," said Scott Sweet, managing director of research firm IPOboutique.com, who expects the Visa offering early in the year.

Hopes are high that the world's largest credit-card processor will take the lead of its smaller rival MasterCard Inc, which has seen its share gain more than 440 percent since its initial IPO price of $39. MasterCard shares closed at $212.35 on Friday.

Things have been a bit bumpy lately for Visa, as reflected in its Friday disclosure that the company posted a loss in fiscal 2007. The company had a $1.1 billion operating loss, while operating revenue rose 33 percent to $5.2 billion. The loss included nearly $3 billion in reserve for outstanding litigation.

But a word of caution from USAToday's Matt Krantz:

Just be careful before jumping into Visa stock. Since MasterCard did so well, there's going to be a mania for Visa shares. Make sure Visa's valuation is reasonable compared with MasterCard's before chasing it.

Further Reading on Seeking Alpha:

• Visa IPO Around The Corner

• Visa IPO? Priceless
• How To Profit From The Visa IPO Before It Goes Public?

• Visa IPO Should Ring Up The Register

Comments

[Burlcouch:]

Remember, Mastercard's IPO was not a "sell out", it was supposed to come out at $41-$43, but lack of buyers, MA IPO'd at $39. That gave small investors, like me, to get a piece of the action. I ask for & got 500 shares. I still have them. I'm no longer a small investor. Priceless. Visa should consider offering part of its IPO to its many users, like Google did when it IPOd. What a way to cement their Credit Card with their users.

2007 Dec 25 10:33 AM

[ballsschweaty:]

You have a measly $100k worth of stock and you now don't consider yourself a small investor?

LOL!!!!

You're small fry dude.

2007 Dec 26 08:33 AM

[alexdg:]

What is a good valuation? Same P/E ratio as MA? That'll probably be the higher value of the interval the IPO will be trying to set for its stock. Will this IPO reinforce MA current value? or devalue MA because investors will want to spread their money between MA and V?

2007 Dec 26 01:28 PM