Portfolio Update: July 31st, 2008
July 31, 2008 – 10:27 amJust purchased into Mastercard (MA) today at $248.51 a share. Mastercard posted a loss due to the American Express (AXP) lawsuit, which sent shares tumbling today. This is just a chink in the armor and I viewed this as an 8% discount to buy into the company. This pullback is directly in line with the expectations I made in my American Express article when I stated:
“American Express closed this afternoon down 4.34% to 37.31 and is trading at 11.33x forward earnings based on consensus earnings estimates compared to Mastercard who closed today at 257.50 and is trading at 29.2x forward earnings. In my opinion, Mastercard is due for a correction as its P/E continues to rise.”‘
With the world converting from cash to plastic, credit card companies will always be a great long term investment. I am still bullish on American Express, which is my most favorite credit card issuer. Thanks for reading.
-Justin Moon, Senior writer for Marketchasers.com