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Visa’s Stock Analysis Valuation Assumptions

Today I’ll make a stock analysis based on the Discounted Cash Flow Model.

Here’s my assumptions:

Risk Free Rate (10 Years Interest Rate Swap): 4.131%

Risk Premium (Taken from the Aswath Damodaran equity premium spreadsheet): 4.33%

Interest Rate Spread on The Risk free rate ( For the cost of debt calculation): 1%

Last 2 years Beta (taken as a reference): 0.7

HISTORICAL DATA

Revenue growth in the last 10 years (CAGR): 11.15%

Earnings growth in the last 10 years (CAGR): 13.48%

Unlevered Free Cash Flow growth in the last 10 years (CAGR): 7.76%

FUTURE ASSUMPTIONS

End of Year FCF growth: 8%

Growth until end of 2026: 8%

Growth until end of 2034: 6%

Perpetual growth: 3.2%

Net Debt: $7.011B

Stock Options Present Value Assumption: $0.901B

Restricted Stock Units Present Value Assumption: $2.612B

Shares Outstanding: 1.87 Billion

Stock Valuation based on these assumptions: $395

Last update 05/13/2025

All the content in this newsletter should be taken as informational content only. THIS IS NOT FINANCIAL ADVICE! Do your own Due Diligence before investing or contact a professional financial advisor.

I don’t have a position in Visa (V) and I don’t plan to add a position in the coming days.