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A Review Of My Visa (V) Investment: Quality Growth Chaser

|About: Visa Inc. (V)
Summary

V has delivered long term big gains.

V has been a quality growth chaser stock.

Can V stay this way.or is it due to become a blue chip suitable for value analysis?

Here is my V investment:

date shares total price $/share
21-Aug-2013 240 $ 10,411.15 $ 43.38 basis
3-Dec-2013 0.472 $ 24.00 $ 50.85 div
3-Apr-2014 0.452 $ 24.05 $ 64.20 div
3-Jun-2014 0.452 $ 24.09 $ 53.30 div
3-Sep-2014 0.448 $ 24.14 $ 53.88 div
9-Dec-2014 0.428 $ 29.02 $ 56.19 div
3-Mar-2015 0.424 $ 29.07 $ 68.56 div
2-Jun-2015 0.419 $ 29.12 $ 69.45 div
1-Sep-2015 0.406 $ 29.17 $ 71.90 div
1-Dec-2015 0.427 $ 34.09 $ 79.81 div
1-Mar-2016 0.471 $ 34.15 $ 72.52 div
7-Jun-2016 0.43 $ 34.22 $ 79.50 div
6-Sep-2016 0.423 $ 34.28 $ 80.95 div
6-Dec-2016 0.533 $ 40.47 $ 75.96 div
7-Mar-2017 0.459 $ 40.55 $ 88.42 div
6-Jun-2017 0.428 $ 40.63 $ 95.03 div
5-Sep-2017 0.39 $ 40.70 $ 103.75 div
5-Dec-2017 0.435 $ 48.18 $ 110.74 div
6-Mar-2018 0.44 $ 51.97 $ 119.43 div
5-Jun-2018 0.395 $ 52.07 $ 131.79 div
4-Sep-2018 0.355 $ 52.15 $ 147.11 div
4-Dec-2018 0.443 $ 62.17 $ 140.83 div
5-Mar-2019 0.418 $ 62.28 $ 149.14 div
  • total shares: 249.545
  • basis: $ 10,411.15
  • avg $/share: $ 45.09
  • avg $/share (basis shares offset by div shares): $ 41.72
  • current price: $ 157.65
  • current value: $ 39,340.77
  • total return: 277.87%
  • CAGR: 26.65%
  • S&P500 wi reinvested Div total return: 87.377%
  • S&P500 wi reinvested Div CAGR: 11.904%
  • shares earned as reinvested dividends: 9.545
  • base value of shares earned as reinvested dividends: $ 840.57
  • current value of shares earned as reinvested dividends: $ 1,504.77
  • reinvested dividend total gain: 79.02%

V has always had high PEs. It was 23.3 when I bought in Aug 2013. It's historical average is 24.9. But it has consistently produced 21%+ earnings growth. Check this out:

This is a so called quality growth chaser. I learned this from Chuck Carnevale, an SA author and proprietor of the Fast Graphs I use. It's worth buying high earnings growth, higher PE stocks if they're consistent. This also should show up in a more favorable PEG. In fact, I've learned that cash flow growth, with no PE, emphasizing non-GAAP, is worth chasing during the ascendancy, like CRM...but this is a different story...yet worth noting.

V performance has CRUSHED the S&P500. Superlative deserved! But can it continue? The PE now is a blended 31.7. The 3 year earnings growth is 15.7%. The gap between PE and earnings growth is growing.

I definitely will hold. But the question is whether to put in more. I like the fundamentals. Quarterly Revenue Growth (yoy) is 13.20%. Quarterly Earnings Growth (yoy) is 18%. But I see a slow down relative to price being asked.

My take is not to invest now. I might change my mind. I wouldn't go wrong to add, as I'd still get solid CAGR if 18% growth continues, even as PEs start to slowly contract. I will try to work out the math later.

Finally, I see V as a strong moat. AAPL is working with MasterCard for its new credit card. Indicating credit card companies still are deep in the payment chain. I am very happy with V and how it has performed.

Disclosure: I am/we are long V.