Visa or Mastercard: Which sets up better for 2026? Jefferies weighs in, citing Visa's favorable near-term setup.

Jefferies believes Visa is better positioned than Mastercard for 2026, despite Mastercard having stronger long-term growth prospects. Visa's growth algorithm points to 10% constant-currency revenue expansion, while Mastercard's revenue growth is expected to slow. Jefferies maintains Buy ratings on both stocks, with targets of $410 for Visa and $675 for Mastercard.

Jefferies analysts have expressed confidence in Visa's (NYSE: V) near-term prospects, positioning it as better than Mastercard (NYSE: MA) for 2026. Despite Mastercard's stronger long-term growth prospects, Visa's growth algorithm points to a 10% constant-currency revenue expansion for fiscal 2026 (FY26), driven by a bigger pricing tailwind and slower growth in client incentives Visa Inc. $V Holdings Boosted by Acadian Asset Management LLC^[1].

Trevor Williams, the analyst at Jefferies, noted that Visa's revenue growth could edge closer to 11% if value-added services (VAS) growth reaches 20% instead of the base case of 18%. Mastercard, on the other hand, faces headwinds from the Capital One debit de-conversion in the U.S. and the Lloyds U.K. credit portfolio flip to Visa, which could weigh on its revenue growth Visa Inc. $V Holdings Boosted by Acadian Asset Management LLC^[1].

Currently, Mastercard is trading at a 21% valuation premium to Visa, compared to a five-year average premium of 17%. Jefferies expects this gap to shrink as Visa's revenue growth in FY26 is projected to trail Mastercard's by only 0.5 to 1.5 percentage points, compared to a gap of 2 to 3 percentage points in FY25 Visa Inc. $V Holdings Boosted by Acadian Asset Management LLC^[1].

Jefferies maintains a Buy rating on both stocks, with targets of $410 for Visa and $675 for Mastercard. The analyst sees more near-term upside to estimates for Visa given its conservative third-quarter guidance. Visa's path to growth is considered "undemanding," with the benefit of 1.5 years of pricing impact, lower incentives drag, and improving cross-border mix offsetting weaker currency volatility Visa Inc. $V Holdings Boosted by Acadian Asset Management LLC^[1].