Mastercard (NYSE:MA) will release its Q4 results on Thursday, January 29, before the U.S. market opens, while Visa (NYSE:V) will report earnings on Thursday after the market close (Friday morning Beijing time). Ahead of these releases, JPMorgan published a research note stating that, despite some headwinds, the fundamentals remain solid. The firm reiterated its “Overweight” ratings on Mastercard and Visa, with price targets of $685 and $430, respectively.

JPMorgan pointed out that consumer data shows Q4 growth slowed only slightly. Given this modest slowdown, it suggests that U.S. domestic consumers remain healthy (Chase credit card data indicates that spending growth has even accelerated since early January). In addition, both companies are reasonably valued, and their stock performance is relatively predictable (most notably, Visa’s tokenization value-added service fee scheduled to begin in April). These factors make the firm optimistic about both companies’ performance, although it shows a slight preference for Visa.

Nevertheless, a series of recent news events has intensified market pessimism regarding the entire industry, including credit card networks. Regarding the Credit Card Competition Act (CCCA), which has been a recent market focus, JPMorgan believes its impact on these two payment companies is unlikely but manageable. The implementation of the act may take several years, giving payment networks ample time to restructure their business and adjust pricing strategies based on value accumulation (as they have done in the past), thereby offsetting what JPMorgan expects to be a relatively mild financial impact.

JPMorgan believes that the upcoming earnings reports present a positive risk-reward scenario but acknowledges that strong results or guidance alone may not fully alleviate investors’ near-term concerns. However, the firm views market volatility as an opportunity to buy high-quality assets.

CCCA Issue: Previously, former President Trump posted on social media encouraging support for the Credit Card Competition Act (CCCA). The bill was originally proposed in 2022 but ultimately failed to gain broad support. The core provision of the act requires most Visa and Mastercard credit cards to include an independent third-party payment network, similar to the structure of debit cards. JPMorgan believes the bill is unlikely to gain traction, primarily because it does not offer substantial benefits to consumers or merchants and imposes disproportionate operational burdens. Even if the bill is enacted, the firm believes Visa and Mastercard can manage it, and the economic impact over the coming years would likely be minor.

Mastercard (NYSE:MA) Earnings Expectations: JPMorgan expects revenue and EPS to be roughly 1% below consensus. Q4 results may be affected by currency fluctuations, and Mastercard has already lowered its guidance during the quarter. JPMorgan’s forecast for U.S. transaction volume growth in Q4 is slightly below Wall Street expectations, assuming that Capital One’s partial business transition slows growth by 240 basis points (though overall consumer trends remain broadly stable). For fiscal year 2026, JPMorgan’s baseline expectation is that Mastercard will guide for low double-digit growth in both FX-adjusted and organic revenue (JPMorgan expects 12% growth). The firm believes this is already sufficient given the current stock price, especially considering Mastercard’s attractive relative valuation.

Visa (NYSE:V) Earnings Expectations: JPMorgan’s Q1 revenue and EPS estimates are largely in line with consensus, but for fiscal year 2026, the firm’s revenue and EPS forecasts are about 1 percentage point higher than Wall Street’s expectations, likely benefiting from currency fluctuations (JPMorgan’s model indicates this could add roughly 50 basis points relative to prior estimates). The firm believes that core operational trends should remain positive in the near term, including early January transaction volume growth indicating acceleration and expectations for growth in the second half of the year. Furthermore, tokenization service pricing appears to partially support this trend. Combined with its attractive valuation (relative to the market and Visa’s historical performance), JPMorgan views this quarter and the full year as having a favorable risk-reward profile and reiterates Visa as its top pick for 2026.

Quarterly Transaction Volume Data: Bank of America (NYSE:BAC), Citigroup (NYSE:C), JPMorgan Chase (NYSE:JPM), U.S. Bancorp (NYSE:USB), and Wells Fargo (NYSE:WFC) — which collectively account for nearly half of domestic Visa and Mastercard transaction volumes — have already reported their Q4 2025 payment volume metrics. The combined credit card transaction growth among these five issuers slowed by 40 basis points (with total transaction volume up 6.2% YoY, compared with 6.7% in Q3). This was significantly better than JPMorgan’s earlier preview forecast (which expected growth to slow nearly 2 percentage points) and also exceeded Wall Street expectations (with Visa/Mastercard transaction volume growth slowing roughly 1 percentage point, factoring in Mastercard’s drag from Capital One’s transition). Chase credit card data shows that as of January 13, January transaction volume growth has accelerated, up 130 basis points from Q4 and 220 basis points from December last year.