Which Stock Is a Better Buy? Visa or Mastercard?

There aren't many businesses quite like Visa (NYSE: V) and Mastercard (NYSE: MA). Both operate open-loop payment networks -- the rails that shuttle money between a shopper's bank and a merchant's -- while the banks that issue the cards, not the networks, take on the credit risk. Each network also grows more valuable as it scales; more cardholders attract more merchants, and vice versa. That durability is why both have compounded for years and generated enormous free cash flow along the way.The model is also remarkably asset-light. Neither company lends money or carries inventory, and both run on modest capital expenditures. So most of the fees they collect become profit.These similarities them easy to compare. Even more, Visa's market capitalization sits near $657 billion and Mastercard's near $465 billion, yet the two carry almost the same price-to-earnings ratio of about 30. So the question isn't which is the better business. Both are exceptional. It's which is the better buy when the price tags are this close.Continue readingWeiter zum vollständigen Artikel bei MotleyFool Weiter zum vollständigen Artikel bei MotleyFool