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Today's Bonus Story Why Mastercard and Visa Are the Definition of Forever StocksAuthored by Jordan Chussler. Published: 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: The Biggest IPO Ever: Claim Your Stake Today
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. But zooming out, the companies that make up the sector have proven to be key components of buy-and-hold investors' portfolios. Every single time, the story has been the same. People go to sleep thinking their money is safe. They wake up to find their life savings decimated by government action. Do not let FedNow catch you sleeping. Get the 4 steps here and act on them now With high-quality growth stocks increasingly difficult to identify, two legacy companies operating in the global payment-processing and digital-payment markets continue to produce profit margins that qualify them as "forever stocks." Why Digital Payment and Payment Processors Make for Good Forever Stocks These companies have historically enjoyed higher profit margins than many other industries because of high-volume demand, ease of automation and technology-driven business models that translate into very low marginal costs per transaction. The industry is also poised for strong 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 to more than $361 billion. While that level of growth and attractive gross margins could suggest the space is crowded, two of the biggest names in the industry still operate in a veritable duopoly, controlling more than 90% of credit-card and digital payments processed outside China. With roots dating back to the mid-1900s, these companies control much of the digital payment and payment-processing infrastructure, allowing them to set fees, limit competition and maintain consistently strong margins. Despite challengers such as Block (NYSE: XYZ), with its Cash App, and PayPal (NASDAQ: PYPL), with Venmo, none fit the bill of a "forever stock" better than the two below. Mastercard: The $450 Billion Market Cap Company Focusing on Tech Integration Since Michael Miebach took the reins at Mastercard (NYSE: MA) in 2021, management has focused on expanding tech platforms, supporting cross-border commerce and developing services that help clients reduce fraud, streamline payment flows and leverage payments data for insights. Those efforts helped Mastercard achieve record revenue and net income in 2025. Revenue of nearly $33 billion represented a year-over-year (YOY) increase of more than 16%, while net income of nearly $15 billion also rose by more than 16%. That profitability was driven in large part by an effective 100% gross margin throughout 2025, enabled by tech integrations and a minimal cost of goods sold, which resulted in quarterly gross profit essentially matching quarterly net revenue. For investors, that has translated into consistent earnings performance. The last time Mastercard missed earnings was Q3 2020 following the onset of the COVID-19 pandemic. Since then, the company has reported 21 consecutive quarterly earnings beats. Most recently, Mastercard reported Q4 2025 EPS of $4.76, a nearly 25% YOY increase versus the prior-year quarter. Analysts expect Mastercard's earnings to grow roughly 17% in the year ahead, from $15.91 to $18.61 per share. At the same time, the company has been moving from a traditional payment network toward an AI-driven, software-focused enterprise emphasizing enhanced security, simplified B2B transactions with virtual cards and agentic AI tools. Additionally, Mastercard pays a dividend that, while modest (currently 0.69%), has increased for 13 consecutive years. The firm maintains a sustainable payout ratio of about 21.07%, and its annualized five-year dividend growth rate is 13.70%. Visa: Evolving and Adapting Since 1958 Visa (NYSE: V) uses 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 solutions—focusing on AI-driven products and blockchain-based settlement—to transition from traditional card-based transactions toward more flexible, digital-first experiences by 2026. This produced record revenue and net income in 2025: revenue was $40 billion (an 11% YOY increase) and net income nearly $20 billion. Visa's consistency is notable. The company hasn't missed earnings in the past 10 years; during that stretch it met analysts' expectations twice and beat EPS estimates 38 times. Much of that reliability can be attributed to Visa's nearly 83% gross profit margin in 2025, in line with its 10-year average. Like its peer, Visa also pays a modest dividend, currently yielding 0.87%. Its payout ratio is about 25.14% and its annualized five-year dividend growth rate is 14.48%. The company has increased its payout for 17 consecutive years. | 
