Consumer confidence may have plummeted to a five-year low on Tuesday but you wouldn’t know by looking at the stocks of Visa or Mastercard .
While not impervious to a slowing U.S. economy, both credit-card companies are benefiting from a global sea change as people around the world turn from cash to plastic to complete the majority of their transactions.
And the move doesn’t show signs of slowing, Pete Najarian said on Tuesday’s Closing Bell. Visa owns over half the global processing market, making it the “king,” he said, but Mastercard is doing just fine itself as it reported profits that more than doubled thanks to increased card use overseas.
These stocks can be used, to some extent, as indicators for the economy, according to Najarian, because they show where American consumers are spending money. As stocks, though, they’re in a league of their own. Najarian recommended both V and MA as buys, but said he would wait for pullbacks in either before loading up. There’s no reason to chase these, he said. The long-term trend is very much intact.
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