Visa shares fall on weak 2014 outlook
Shares of the credit card company are down more than 4 percent in early trading after disappointing revenue guidance for 2014.
Visa (V) shares opened lower Friday after the company reported second quarter earnings that beat estimates but offered disappointing revenue guidance for the rest of 2014.
Shares were lower by 4.02 percent to $200.98 in early trading Friday.
Visa reported second quarter earnings of $2.52 per share versus a consensus of $2.18 after Thursday's market close.
However, the electronic payment processor said revenues would grow by 10-11 percent in 2014, down from previous guidance of 10-13 percent growth.
"The outlook commentary is one of the main drivers of the weakness in the shares after hours," argued KBW analyst Sanjay Sakhrani in a research note. Sakhrani cited not only the weaker revenue growth projections but the inclusion of a $218 million tax benefit in full year guidance for fiscal 2014, which he argued implies "lower growth for the back half of the year than originally anticipated."
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The company plans to close stores and lay off employees, and says it needs to make some deeper changes.
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