Weitz Funds Comments on Mastercard - Nov 11, 2016

Mastercard (NYSE:MA) operates the world’s second-largest payment network and one of the best known global brands. During the quarter, shares rose as investors applauded continued payment volume growth and a slightly improved economic global outlook. Mastercard is among the most attractive businesses we own. Its network is well entrenched within the plumbing of payment systems across the globe. The transition from cash to digital forms of payment provide growth opportunities, while the core business produces healthy doses of excess cash flow with modest reinvestment requirements.

• From Weitz Balanced Fund third quarter 2016 commentary.

Tom Russo Comments on MasterCard - Sep 26, 2016

MasterCard (NYSE:MA) shares have suffered during the first half of 2016 in part as a reaction against all the global disruption ongoing in financial markets and global political corridors. Terrorist bombings throughout Europe slow travel and slow cross-border transactions, the growth of which had over the past decades fueled growth in interconnect revenues. Decline in consumer confidence also pressures revenues and growth in gross dollar volumes billed.

Finally, MasterCard and other domestic payment networks suffer from concern over the overturning of an agreed settlement with retailers over alleged anticompetitive pricing activities. The repeal of the settlement in the United States coupled with a judicial loss in the United Kingdom in a law suit alleging anticompetitive pricing has triggered concerns over regulatory and legal environment, now weighing on MasterCard’s share price.

I believe that current turbulence impacting MasterCard’s share price will abate as travel patterns return, consumer confidence restores, and payment networks reach reasonable ways in which to be paid for the benefits that payment systems offer merchants. The growth of mobile platforms will only further drive the migration globally from cash payment (cash payments represent currently over 80 percent of commerce throughout the world beyond the United States) to digital payment. MasterCard has massive capacity to reinvest mature industry cash flows to exploit new marketing opportunities for using credit, for increased consumer spending, for assisting government distribution of social benefits in secure manner, etc.

From Tom Russo (Trades, Portfolio)'s Semper Vic Partners second quarter 2016 shareholder letter.

Wallace Weitz Comments on MasterCard - Apr 22, 2016

Wallace Weitz Comments on MasterCard - Apr 14, 2016

GAMCO Global Growth Fund Comments on MasterCard Inc. - Feb 22, 2016

MasterCard Inc. (NYSE:MA) (1.9%) (MA – $97.36 – NYSE) is a technology company in the global payments industry that operates the world’s fastest payments processing network, connecting consumers, financial institutions, merchants, governments and businesses in more than 210 countries and territories. MasterCard’s products and solutions make everyday commerce activities – such as shopping, traveling, running a business and managing finances – easier, more secure and more efficient for everyone.

From the GAMCO Global Growth Fund fourth quarter 2015 commentary.

Weitz Funds Comments on MasterCard - Nov 16, 2015

MasterCard (NYSE:MA) is the world’s second largest payment network and one of the best known global brands, needing little introduction. The Fund began building a position below $85 during the broader market swoon in August at a nice discount to our base case estimate of intrinsic value. MasterCard is among the most attractive businesses we own. Its network is well entrenched within the plumbing of payment systems across the globe, the transition from cash to digital forms of payment provides growth opportunities over and above underlying economic expansion, and its core business produces healthy doses of excess cash flow with modest reinvestment requirements. We would welcome additional opportunities to add to the Fund’s position.

From Weitz Funds' Balanced Fund third quarter 2015 commentary.

Baron Funds Comments on MasterCard Inc. - Nov 10, 2015

MasterCard, Inc. (NYSE:MA) is the world’s second-largest payments technology company that connects consumers, businesses, banks and governments, enabling them to use electronic forms of payment instead of cash and checks. There are over two billion MasterCard- and Maestro-branded cards outstanding with acceptance at 36 million locations in more than 210 countries and territories. Broad merchant acceptance and consumer adoption of MasterCard-branded cards create strong network effects. 85% of all payment transactions are made with cash or checks today, while only 15% are made with electronic forms of payment, providing substantial room for further growth. We added to our position in MasterCard in the quarter.

From Baron Opportunity Fund's third quarter 2015 letter.

GAMCO Investors Comments on Mastercard Inc. - Oct 19, 2015

Mastercard Inc. (NYSE:MA)(3.2%) (MA – $90.12 – NYSE) is a technology company in the global payments industry that operates the world’s fastest payments processing network, connecting consumers, financial institutions, merchants, governments and businesses in more than 210 countries and territories. MasterCard’s products and solutions make everyday commerce activities – such as shopping, traveling, running a business and managing finances – easier, more secure and more efficient for everyone.

From GAMCO's Growth Fund third quarter 2015 commentary.

Sequoia Fund Comments on MasterCard - Aug 27, 2015

Question:

A couple of questions on MasterCard (NYSE:MA). Visa (NYSE:V) benefits from a lot of the same secular trends that MasterCard does; so I am curious why you guys own MasterCard and not Visa. Secondly, if you could comment on some of the recent acquisitions that MasterCard has made, and the strategic and financial rationale, if you agree with those.

John Harris:

Let’s see, why do we own MasterCard instead of Visa? There is not really a good answer. We should have owned both. We should have owned more of both. We should have owned a lot more of both. It is a tremendous mistake for which I bear significant responsibility. So that is the answer to that.

The acquisitions — I have to be honest with you, and this is self-deprecating and not intentionally so — I have had a tough time understanding many of the acquisitions that these two companies have done over the years. Not just MasterCard, Visa also. Visa plunked down a sizeable amount of money to buy a business called CyberSource, which worked for a couple years and now is not working so well. There is an understanding at the card networks that things will eventually change. It has been remarkable and surprising to me how slow the pace of change has actually been and how as threats have emerged, they have quickly gone by the wayside. It just turns out that the network business model is incredibly resilient. But there is some concern — subconscious, whatever you want to call it — that eventually things may change and that the change is going to be driven by technology. So there is a desire on both of their parts, especially when new CEOs took over at both companies I noticed a marked increase in this desire, to try to ramp up the pace of innovation hopefully to head off some of the technological threats that they see on the horizon. The fact of the matter is that Visa and MasterCard have not traditionally been terribly innovative organizations. They were cooperatives for most of their lives and overseen by bankers. That is all you need to know on that subject.

They are doing their best. To be totally honest, they feel like part of being innovative and doing a good job is buying small innovative businesses. Whether any of them have really added anything, there certainly is no perceptible evidence. It is possible that at some point in the future we will find out that MasterCard is able to adapt to technological change because of some small acquisition it did in the past — it is entirely possible, but I do not see any evidence of it. In the past, for the most part the deals the company has done have been so small that they have had a nonmaterial impact on the financial progress of the business. This year that has changed a little bit. MasterCard did a couple of deals that were pretty meaningfully dilutive to its earnings so that the company is going to have the slowest rate of earnings growth it has had this year since we have owned the stock and since it has been a public company — we have owned it for its entire life as a public company. A lot of that is foreign exchange, which is a real headwind this year. Part of it is those acquisitions, which are detracting in a meaningful way from the earnings.

Bob Goldfarb:

As to why we bought MasterCard rather than Visa, we bought MasterCard in the first few days that it went public. We should have kept going, as John said. Visa went public later and it was priced off MasterCard, which was selling at a significantly higher price at that time than when it went public.

From Ruane, Cunniff & Goldfarb Investor Day 2015 Transcript Part I.