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Friday's Featured Story Why Mastercard and Visa Are the Definition of Forever StocksAuthored by Jordan Chussler. Article Posted: 3/14/2026. 
Key Points - The financials sector has lagged the S&P 500 this year, but two payment processing giants continue to deliver the kind of margins and earnings consistency that define long-term holdings.
- Despite recent sector-wide struggles, Visa and Mastercard function as a veritable duopoly, controlling over 90% of payments outside of China.
- Visa hasn't missed on earnings in 10 years, while Mastercard has secured 21 consecutive quarterly beats.
- Special Report: Elon's "Hidden" Company
After finishing the past two years with an average annual gain of nearly 23%, the financials sector has struggled this year. With a year-to-date loss of around 9%, the cohort ranks last among the S&P 500's 11 sectors. Zoomed out, however, many companies in the sector remain key components of long-term, buy-and-hold portfolios. Take a look at this image of an AI data center—thousands of them are popping up across America, but one popping up in West Texas is much different from all the others. When it's complete, it will be surrounded by armed guards, razor wire, and 24/7 surveillance, with billions of AI prompts running through this building every single day. What most folks don't know is that you can collect a micro-royalty each time—every ChatGPT query, every Alexa answer, every Netflix recommendation could put money in your pocket. This single opportunity has already paid out over $810 million since 2022, and Marc Lichtenfeld found a way to collect up to 16 income payouts a year from it. Click here to see Marc's full briefing With high-quality growth stocks increasingly difficult to find, two legacy companies in global payment processing and digital payments continue to produce profit margins and durability that qualify them as true "forever stocks." Why Digital Payment and Payment Processors Make for Good Forever Stocks These companies have historically enjoyed higher profit margins than many industries, thanks to high-volume demand, extensive automation, and technology-driven business models that result in very low marginal costs per transaction. The industry is also poised for robust growth. According to industry analytics firm Grand View Research, the global payment processing solutions market, valued at nearly $48 billion in 2022, is projected to grow at a compound annual growth rate (CAGR) of 14.5% through 2030, reaching nearly $140 billion by the start of the next decade. Grand View also forecasts that the digital payment market, valued at more than $114 billion in 2024, will grow at a 21.4% CAGR through 2030, reaching over $361 billion. Despite fast growth and attractive gross margins attracting competition, two of the largest players still operate in a near-duopoly, controlling more than 90% of credit card and digital payments processed outside China. With roots dating back to the mid-1900s, these firms control much of the payments infrastructure, enabling them to set fees, limit competition, and sustain very strong margins. While challengers such as Block (NYSE: XYZ), with its Cash App, and PayPal (NASDAQ: PYPL), with Venmo, seek to disrupt the space, none fit the forever-stock profile better than the two companies below. Mastercard: The $450 Billion Market Cap Company Focusing on Tech Integration Since Michael Miebach became CEO of Mastercard (NYSE: MA) in 2021, management has emphasized expanding technology platforms, supporting cross-border commerce, and developing services that help clients reduce fraud, simplify payment flows, and extract insights from payments data. Those initiatives helped Mastercard deliver record revenue and net income in 2025. Revenue of nearly $33 billion represented a year-over-year increase of more than 16%, while net income of nearly $15 billion rose by over 16% as well. Much of that profitability stems from Mastercard's effectively negligible cost of goods sold. The company reported a gross margin that approximated 100% in 2025, made possible by tech integrations and a business model where gross profit closely tracks net revenue. For investors, that has translated into consistent earnings performance. The last time Mastercard missed on earnings was Q3 2020 following the onset of the COVID-19 pandemic. Since then the company has delivered 21 consecutive quarterly earnings beats. Most recently, Mastercard reported Q4 2025 EPS of $4.76, a nearly 25% year-over-year increase. Analysts expect Mastercard's earnings to grow roughly 17% in the year ahead, from $15.91 to $18.61 per share. The company has also shifted from a traditional payments network toward a more software- and AI-driven enterprise, focusing on enhanced security, simplified B2B transactions with virtual cards, and AI tools that add automation and insights. Additionally, Mastercard pays a dividend. While not large (current yield ~0.69%), the payout has increased for 13 consecutive years. The company maintains a sustainable dividend payout ratio (about 21.07%) and an annualized five-year dividend growth rate around 13.70%. Visa: Evolving and Adapting Since 1958 Visa (NYSE: V) operates a network-based model that enables partner banks and other financial institutions to issue branded payment products while Visa focuses on infrastructure, standards, and technology integration. Like Mastercard, Visa is integrating fintech advances, emphasizing AI-driven solutions and blockchain-based settlement, with the aim of moving from traditional card transactions to more flexible, digital-first experiences. That strategy helped Visa report record revenue and net income in 2025, with revenue of about $40 billion—an 11% year-over-year gain—and net income near $20 billion. Visa's earnings consistency is notable: in the past 10 years the company has never missed an earnings estimate, meeting analyst expectations twice and beating EPS expectations 38 times. Much of Visa's strength stems from gross margins as well; the company reported a gross profit margin near 83% in 2025, consistent with its 10-year average. Like Mastercard, Visa pays a modest dividend (current yield ~0.87%). Its payout ratio is healthy (about 25.14%), its annualized five-year dividend growth rate is roughly 14.48%, and the company has increased its payout for 17 consecutive years. Both Mastercard and Visa combine durable network effects, strong margins, and secular tailwinds from the shift to digital payments—attributes that make them sensible long-term holdings for investors seeking steady, growth-oriented franchises. | 
