Mastercard (Mastercard) ROE %

: 168.64% (As of Dec. 2023)

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ROE % is calculated as Net Income divided by its average Total Stockholders Equity over a certain period of time. Mastercard's annualized net income for the quarter that ended in Dec. 2023 was $11,164 Mil. Mastercard's average Total Stockholders Equity over the quarter that ended in Dec. 2023 was $6,620 Mil. Therefore, Mastercard's annualized ROE % for the quarter that ended in Dec. 2023 was 168.64%.

The historical rank and industry rank for Mastercard's ROE % or its related term are showing as below:

MA' s ROE % Range Over the Past 10 Years
Min: 50.68 Med: 106.13 Max: 184.3
Current: 184.3

During the past 13 years, Mastercard's highest ROE % was 184.30%. The lowest was 50.68%. And the median was 106.13%.

MA's ROE % is ranked better than
99.03% of 513 companies
in the Credit Services industry
Industry Median: 6.49 vs MA: 184.30

Mastercard ROE % Historical Data

The historical data trend for Mastercard's ROE % can be seen below:

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.

* Premium members only.

Mastercard Annual Data

Trend

Dec14

Dec15

Dec16

Dec17

Dec18

Dec19

Dec20

Dec21

Dec22

Dec23

ROE %

143.83

104.38

126.79

145.92

169.27

Mastercard Quarterly Data
	Mar19	Jun19	Sep19	Dec19	Mar20	Jun20	Sep20	Dec20	Mar21	Jun21	Sep21	Dec21	Mar22	Jun22	Sep22	Dec22	Mar23	Jun23	Sep23	Dec23
ROE %																159.57	162.44	210.08	216.54	168.64

Competitive Comparison

For the Credit Services subindustry, Mastercard's ROE %, along with its competitors' market caps and ROE % data, can be viewed below:

* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.

Mastercard ROE % Distribution

For the Credit Services industry and Financial Services sector, Mastercard's ROE % distribution charts can be found below:

* The bar in red indicates where Mastercard's ROE % falls into.

Mastercard ROE % Calculation

Mastercard's annualized ROE % for the fiscal year that ended in Dec. 2023 is calculated as

ROE %	=	Net Income (A: Dec. 2023 )	/	( (Total Stockholders Equity (A: Dec. 2022 )	+	Total Stockholders Equity (A: Dec. 2023 ))	/ count )
	=	11195	/	( (6298	+	6929)	/ 2 )
	=	11195	/	6613.5
	=	169.27 %

Mastercard's annualized ROE % for the quarter that ended in Dec. 2023 is calculated as

ROE %	=	Net Income (Q: Dec. 2023 )	/	( (Total Stockholders Equity (Q: Sep. 2023 )	+	Total Stockholders Equity (Q: Dec. 2023 ))	/ count )
	=	11164	/	( (6311	+	6929)	/ 2 )
	=	11164	/	6620
	=	168.64 %

In the calculation of annual ROE %, the net income of the last fiscal year and the average total shareholder equity over the fiscal year are used. In calculating the quarterly data, the net income data used here is four times the quarterly (Dec. 2023) net income data. ROE % is displayed in the 30-year financial page.

Mastercard (NYSE:MA) ROE % Explanation

ROE % measures the rate of return on the ownership interest (shareholder's equity) of the common stock owners. It measures a firm's efficiency at generating profits from every unit of shareholders' equity (also known as net assets or assets minus liabilities). ROE % shows how well a company uses investment funds to generate earnings growth. ROE %s between 15% and 20% are considered desirable.

The factors that affect a company's ROE % can be illustrated with the three-step DuPont Analysis:

	ROE %		(Q: Dec. 2023 )
=	Net Income	/	Total Stockholders Equity
=	11164	/	6620
=	(Net Income / Revenue )	*	(Revenue / Total Assets)	*	(Total Assets / Total Stockholders Equity)
=	(11164 / 26192)	*	(26192 / 41061)	*	(41061 / 6620)
=	Net Margin %	*	Asset Turnover	*	Equity Multiplier
=	42.62 %	*	0.6379	*	6.2026
=	ROA %	*	Equity Multiplier
=	27.19 %	*	6.2026
=	168.64 %

With this breakdown, it is clear that if a company grows its Net Profit Margin, its Asset Turnover, or its Leverage, it can grow its ROE %.

The factors that affect a company's ROE % can also be illustrated with the five-step DuPont Analysis:

	ROE %		(Q: Dec. 2023 )
=	Net Income	/	Total Stockholders Equity
=	11164	/	6620
=	(Net Income / Pre-Tax Income)	*	(Pre-Tax Income / Operating Income)	*	(Operating Income / Revenue)	*	(Revenue / Total Assets)	*	(Total Assets / Total Stockholders Equity)
=	(11164 / 13284)	*	(13284 / 14792)	*	(14792 / 26192)	*	(26192 / 41061)	*	(41061 / 6620)
=	Tax Burden	*	Interest Burden	*	Operating Margin %	*	Asset Turnover	*	Equity Multiplier
=	0.8404	*	0.8981	*	56.48 %	*	0.6379	*	6.2026
=	168.64 %

Note: The net income data used here is four times the quarterly (Dec. 2023) net income data. The Revenue data used here is four times the quarterly (Dec. 2023) revenue data. The same rule applies to Pre-Tax Income and Operating Income.
^* In the five-step DuPont Analysis, Operating Income is only available for non-financial companies. Thus, for Insurance companies, we use EBIT as a substitution of Operating Income. For Banks, both Operating Income and EBIT is unavailable. Thus we combined Interest Burden and Operating Margin % into Pretax Margin %, and the DuPont Analysis is divided into four components instead.

Be Aware

Net Income is used.

Because a company can increase its ROE % by having more financial leverage, it is important to watch the equity multiplier when investing in high ROE % companies. Like ROA %, ROE % is calculated with only 12 months data. Fluctuations in company's earnings or business cycles can affect the ratio drastically. It is important to look at the ratio from a long term perspective.

Asset light businesses require very few assets to generate very high earnings. Their ROE %s can be extremely high.

Mastercard ROE % Related Terms

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Mastercard (Mastercard) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Financial Services » Credit Services » Mastercard Inc (NYSE:MA) » Definitions » ROE %

Comparable Companies

Traded in Other Exchanges

MA:Peru MA:Mexico 1MA:Italy M4Id:UK 0R2Z:UK M4I0:Germany M4I:Germany M4I:Germany M4I:Germany M4I:Germany MA:Canada MSCD34:Brazil MAST:Austria

Address

2000 Purchase Street, Purchase, NY, USA, 10577

Website

https://www.mastercard.com

Mastercard is the second-largest payment processor in the world, having processed close to over $8 trillion in transactions during 2022. Mastercard operates in over 200 countries and processes transactions in over 150 currencies.

Executives

Ajay Bhalla	officer: President Cyber & Intelligence	2000 PURCHASE STREET, PURCHASE NY 10577
Craig Vosburg	officer: President, North America	2000 PURCHASE STREET, PURCHASE NY 10577
Edward Grunde Mclaughlin	officer: President, Operations & Tech	2000 PURCHASE STREET, PURCHASE NY 10577
Foundation Mastercard	10 percent owner	250 YONGE STREET, SUITE 2400, TORONTO A6 M5B 2L7
Richard K Davis	director	800 NICOLLET MALL, MINNEAPOLIS MN 55402
J. Mehra Sachin	officer: Chief Financial Officer	HESS CORPORATION, 1185 AVENUE OF THE AMERICAS, NEW YORK NY 10036
Hai Ling	officer: Co-President, Intl Markets	2000 PURCHASE STREET, PURCHASE NY 10577
Timothy H Murphy	officer: General Counsel	2000 PURCHASE STREET, PURCHASE NY 10577
Raj Seshadri	officer: President, Data & Services	880 CARILLON PARKWAY, ST. PETERSBURG FL 33716
Raghuvir Malhotra	officer: Co-President, Intl Markets	2000 PURCHASE STREET, PURCHASE NY 10577
Michael Miebach	officer: Chief Product Officer	2000 PURCHASE STREET, PURCHASE NY 10577
Linda Pistecchia Kirkpatrick	officer: President, North America	2000 PURCHASE STREET, PURCHASE NY 10577
Harit Talwar	director	2500 LAKE COOK ROAD, RIVERWOODS IL 60015
Sandra A Arkell	officer: Controller	3005 HIGHLAND PARKWAY, SUITE 200, DOWNERS GROVE IL 60515
Candido Bracher	director	2000 PURCHASE STREET, PURCHASE NY 10577