Mizuho Downgrade Pressures Blue-Chip Stock Lower

The brokerage bunch was optimistic towards V coming into today

Digital Content Manager
Jan 7, 2022 at 10:17 AM
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The shares of Visa Inc (NYSE:V) are down 1.4% to trade at $216.62 at last check, after the financial services concern received a downgrade from Mizuho to "neutral" from "buy," as well as a price-target cut to $220 from $255. The analyst in question cited competition from buy-now-pay-later names such as Plaid and FedNow, as well as Covid-19 impacts on the cash-to-card runway, which makes up roughly 45% of the company's revenue growth.

Analysts were optimistic towards Visa stock coming into today, with 22 of 23 in question carrying a "buy" or better rating. Plus, the 12-month consensus target price of $272.15 is a 25.4% premium to current levels.

The equity has staged an impressive bounce off its Dec. 1 annual low of $190.10, though this rally lost momentum at the 180-day moving average earlier this week. The 20-day moving average could keep this pullback in check, however. Plus, the shares are testing a familiar floor at the $216 today. Year-over-year, V is just above breakeven. 

Options traders have been pessimistic towards Visa stock of late. This is per the equity's Schaeffer's put/call open interest ratio (SOIR) of 0.73, which stands higher than 84% of readings from the last 12 months. This means short-term options traders have rarely been more put-biased.




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