KBW: Visa's 10-K Filing Contains Several 'Interesting Items'

Sanjay Sakhrani of Keefe, Brueyette & Woods found several interesting items in Visa Inc's V 10-K report filed on Friday.

Sakhrani notes that the Consumer Financial Protection Bureau (CFPB) dropped its inquiry into how the company converted U.S. cardholder's foreign transactions into U.S. dollars. The CFPB notified the company on November 6 that completed its investigation with no intent of taking enforcement action.

The analyst notes that the completion of the inquiry is a "positive as it removes one potential overhang."

Sakhrani also notes that Visa changed the language it previously used in filings where a potential purchase price of Visa Europe was quantified as "several billion or more." In the new filing, the company stated that it may cost "in excess of $10 billion" to acquire Visa Europe.

However, according to Sakhrani, a purchase price in excess of $10 billion is "relatively" in-line with his initial analysis and that an acquisition of Visa Europe is "financially attractive with potential accretion” that ranges on the low-single-digits to low-double digits. The analyst adds that the acquisition could also be "strategically enhancing."

Shares of Visa are Outperform rated with a $256 price target.