Visa and Mastercard Have Both Reported. Which Payments Giant Is the Best Buy Now?

When it comes to global commerce, few businesses are more significant than Visa (NYSE: V) and Mastercard (NYSE: MA). Their scale is unmatched. Each company counts billions of cards in use around the world. They process trillions of dollars in volume each quarter. And they have nearly ubiquitous acceptance.

Both of these S&P 500 stocks reported financial results for the three-month period that ended June 30, giving investors a fresh look at these companies.

Which payments giant is the better buy right now?

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Both companies operate at a high level

Investors will undoubtedly find that it's difficult to complain about the numbers, and both Visa and Mastercard put up strong quarterly results.

Visa reported net revenue of $11.6 billion during its third quarter of fiscal 2026, which was 14% higher year over year. This was driven by a 10% jump in total payments volume (TPV). Cross-border volume was up 13%.

During its second quarter, Mastercard's net revenue rose 14% year over year to $9.3 billion, boosted by 8% growth in TPV. The company registered a 12% increase in cross-border volume.

Besides processing payments, Visa and Mastercard generate sizable revenue from value-added services. This includes things like advisory services, security solutions, and market insights. For Visa, revenue here surged 36%. At Mastercard, it climbed 20%.

Profitability trends differed. Visa's net income margin went from 51.8% in the year-ago period to 48.4% in the latest fiscal quarter, as its operating expenses were up 19% due mainly to personnel.

Mastercard's net margin expanded, from 45.5% in Q2 2025 to 47.3% in the second quarter this year. This reveals how its management team is running the business with better cost discipline.

It's still encouraging to see these two companies performing extremely well at a time of elevated investor concerns. The potential for interest rates to stay higher for longer, stubborn inflation, high stock valuations, and uncertainty around the artificial intelligence (AI) boom clearly haven't gotten in the way of the success that Visa and Mastercard are experiencing.

One financial stock is more compelling

When choosing between these financial stocks, the easy answer is to simply buy both. This will give investors adequate exposure to the payments landscape by owning high-quality businesses. Visa and Mastercard possess tremendous network effects that make their competitive positions almost unassailable.

But if I had to pick a single stock, I'd go with Mastercard.

On the surface, Visa and Mastercard look identical. To be clear, though, they are different. And it's precisely this disparity that supports my view on which is the better investment opportunity.

One notable area of difference is their volume mix. Mastercard has a stronger position outside the U.S., as international markets made up 70% of its TPV in Q2, compared to 55% for Visa. Having greater international exposure adds growth potential.

So does the fact that Mastercard is smaller. Assuming that the business can reach market share parity with Visa in the long term, it has more upside. This shows up in the numbers. Mastercard's operating income climbed at a 19.5% compound annual rate in the past five years, faster than Visa's 11.1% yearly gain.

Therefore, during the next five years, I believe that Mastercard will generate a higher return compared to Visa. The prospect of better earnings growth is one obvious catalyst. The market appreciates a robust expansion story.

Valuation is the other factor. Mastercard's price-to-earnings (P/E) ratio of 31.1 is just slightly cheaper than its bigger rival's multiple. This is not a usual occurrence, given that Visa's average P/E ratio in the past decade is at a 9% discount to Mastercard's.

No one can question that these are two exceptional businesses. But Mastercard is the better buy right now.

Neil Patel has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Mastercard and Visa. The Motley Fool has a disclosure policy.