(By Balachander) Deutsche Bank (DB) lifted its price target on shares of Visa Inc. (NYSE:V) to $135 from $125, while reiterating its "Buy" rating on the stock, following the payment network's second-quarter results.
Visa posted stronger-than-forecast quarterly earnings, spurred by double-digit revenue growth from data processing, service and international transactions.
Adjusted EPS were $1.60 on operating revenue of $2.6 billion.
The bank noted the company's EPS and revenue beat its estimate of $1.48 and $2.48 billion driven by improvement in cross-border, US Credit, and ROW purchase volumes.
The clear negative of the quarter was the decline in the U.S. debit volume which was not a surprise, but the magnitude of the drop was a little more than we expected, the bank wrote in a note.
However, it is clear that the revenue and EPS implications of this debit loss are minimal, which is demonstrated by the raise in FY12 EPS guidance, DB said.
Due to the EPS beat, DB increased its FY12 and FY13 EPS estimates by $0.12 to $6.03 and $7.15 respectively.
Visa shares, which have been trading in the 52-week range between $73.11 and $125.35, fell 3.40 percent to trade at $118.03 on Thursday.