Visa stock upgraded to outperform at Wedbush as mobile payments becomes a catalyst

Visa Inc. stock on Friday was upgraded to outperform from neutral by Wedbush analyst Moshe Katri, citing the payments company's attractive business model, growth prospects and outlook for increasing shareholder returns. Katri, in a note to clients, points to a host of growth/scale catalysts, including the displacement of cash and checks by electronic payments, incremental revenue opportunities from European regulations and hyper-growth in mobile payments. Katri points out in his note that according to eMarketer retail mobile commerce accounted for $88.5 billion of retail sales in 2015. That's 1.9% of total retails and 26% of electronic commerce sales. "By 2017, mobile commerce sales are expected to reach $151 billion, more than one-third of ecommerce sales," Katri wrote. "Importantly, we believe this trend could lead to improving economics for the networks, as [card not present transactions] typically call for higher interchrge fees." Katri also bumped his 12-month price target to $96 from $77. Shares of Visa have gained more than 15% in the trailing 12-month period, while the S&P 500 Index is up nearly 22% and the Dow Jones Industrial Average is up more than 25% in the same time.

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