Home Stock As Mastercard buys a crypto intelligence firm, is it time to buy MA shares?

As Mastercard buys a crypto intelligence firm, is it time to buy MA shares?


On Thursday, Mastercard Inc. (NYSE:MA) shares edged slightly higher after revealing plans to purchase a crypto intelligence firm. The company is buying CipherTrace, a cryptocurrency intelligence firm that tracks more than 900 cryptocurrencies.

It plans to use the platform to accelerate its crypto strategy implementation amid increasing cryptocurrency acceptance. Mastercard plans to finalize the acquisition by the end of the year.

In a statement following the announcement, the payments services provider said:

The integrated offering will build on CipherTrace’s suite of digital assets and Mastercard’s cyber security solutions to provide businesses with greater transparency to help identify and understand their risks and to help manage their digital asset regulatory and compliance obligations.

By combining CypherTrace’s technology with the artificial intelligence and cyber capabilities of both companies, Mastercard will be able to differentiate its card and real-time payments infrastructure. As a result, it will improve cyber protection and compliance for customers as they launch digital assets. 

Should you buy MA shares in September 2021?

From a valuation perspective, Mastercard shares trade at a reasonable forward P/E ratio of 32.96, making the stock attractive to value investors. In addition, analysts expect its earnings per share to grow at an average annual rate of about 27.30% over the next five years.

As a result, growth investors could also find the stock compelling going into the tail-end of the year. Therefore, given MA shares are up just over 3% over the last 12 months, the stock could gain significantly to catch up with the rest of the market.

For reference, the S&P 500 index is up 33% over the same period.

Source – TradingView

Mastercard rebound seems poised to continue

Technically, Matercard shares appear to have recently bounced back after retesting the trendline resistance in the intraday chart. However, the stock is yet to hit overbought conditions of the 14-day RSI and continues to trade several levels below the 100-day moving average.

Therefore, the current bull-run seems poised to continue following Thursday’s announcement. As a result, investors can target extended gains at approximately $373.06 or higher at $393.47. On the other hand, if the stock price pulls back, it could find support at $333.64 and $314.48.

Bottom line: Why buy the Mastercard rebound?

In summary, although Mastercard shares are up 3.71% this week, the stock is yet to hit the overbought conditions of the 14-day RSI. Moreover, the MA stock trades at reasonable valuation multiples and offers exciting growth potential.

Therefore, it may not be too late to invest in Mastercard shares as it accelerates its crypto strategy with the purchase of CypherTrace.

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