Financial Planning 46th Edition: Visa, Inc. (V) Spotlight
INVESTMENT MANAGEMENT || FIDUCIARY ADVICE || RETIREMENT PLANNING
"Visa, Inc. is a stock that we have long viewed as a strategic, core holding for clients....."
We are pleased to introduce Rajesh Dheenathayalan, CFA®, a vital member of our team as an Investment Analyst. Rajesh is responsible for stock research and valuation analysis, where he focuses on identifying high-quality investment opportunities and scrutinizing how businesses generate long-term value. This work directly supports the management of client portfolios and upholds our firm’s fiduciary commitment.
Rajesh brings over a decade of analytical experience across capital markets, investment research, and financial strategy. His extensive background includes a reputation for dissecting financial institutions at Marmore MENA Intelligence and leading high-stakes, complex projects at KPMG’s Deal Advisory team in Kuwait.
He is a proud CFA charterholder and holds a Master of Finance degree (with distinction) from Hult International Business School in Boston. Rajesh also holds the Financial Modeling & Valuation Analyst (FMVA)® certification.
Rajesh became a member of the Tilia team July 1st, and very quickly became a valuable contributor to our investment management effort. We hope that each of our clients will get the opportunity to meet Rajesh in 2026, if you haven’t already.
Stock Spotlight: Visa, Inc. (V) Overview
Visa, Inc. is a stock that we have long viewed as a strategic, core holding for clients, and its long-term relative performance is exceptional, significantly outperforming both the S&P 500 Index and the S&P 500 Financials Index over the past decade.
Over the last decade, Net Revenues have expanded at a compound annual growth rate of roughly 10% a year, Diluted Earnings Per Share (EPS) has grown at an average rate of approximately 18% a year, and the company has grown its dividend every year since its IPO.
While the average person may think of Visa as a credit card company, the company doesn’t actually issue credit to anyone. Visa is just the payment processor, and takes a tiny cut of all payment volume conducted over its vast network. As inflation makes everyday spending more expensive, Visa’s tiny cut of the payment volume makes it a natural inflation hedge for investors.
A few of the attributes that have allowed Visa to thrive are below:
Global Payment Rails & Unmatched Scale
Visa’s network is the operating system for global commerce. The company facilitated 233.8 billion total transactions in fiscal year 2024, with total volume reaching $15.7 trillion. This is nearly double the total volume processed by the nearest competitor, Mastercard. This scale is cemented by 4.6 billion payment credentials in circulation, accepted at over 150 million merchant locations worldwide, making it the default network for international payments. Within domestic debit card transactions, Visa has roughly 70% of the market share.
Diversified Growth Vectors
Visa is successfully executing a strategy to capture “New Flows” beyond traditional consumer card swipe revenue. Visa Direct, its real-time push payments service, facilitated nearly 10 billion transactions in 2024, and Visa Commercial Solutions volume reached $1.7 trillion, capitalizing on the multi-trillion-dollar business-to-business (B2B) payments market.
Proprietary Value-Added Services (VAS)
Expanding the suite of security, data, and consulting services deepens client relationships and provides an essential, high-margin revenue stream. In 2024, Visa signed over 12,000 new deals and renewals for VAS, marking a 17% year-over-year increase. New products, such as Visa Payment Passkey for biometric authentication, ensure the network remains the most secure.
Continued Digitalization Runway
The shift from cash to digital remains a massive, multi-decade secular trend, and Visa is leading the conversion. “Tap to Pay” has become a key indicator of digital adoption, accounting for 72% of all face-to-face Visa transactions globally, demonstrating the continued migration away from physical payment methods.
In the short-run, Visa faces ongoing competition from fintechs and regulatory scrutiny regarding domestic payment rails. However, over the longer-term, we are confident that the company’s indispensable network, superior scale, and commitment to driving innovation will continue to be rewarding for shareholders.
Sources:
Nasdaq Article on Visa Strategy
Internal Client Portfolio Records (Specific year 2017 portfolio data)
Visa, Inc. Investor Relations (Data compiled from annual reports and press releases)
