Most people don't think of credit card companies as being warm and fuzzy but that's not stopping investors from buying.
Visa's stock hit a new 52-week high Tuesday and MasterCard is just shy of that mark for its stock.
It's been a long road.
Back in 2005, a group of merchants sued Visa (V), MasterCard (MA) and other credit card processors for allegedly conspiring to fix so-called swipe fees at unfairly high levels. They managed to settle their differences, with 7 million merchants splitting $6 billion in damages under a proposed deal.
While a number of retail groups are still up in arms over the settlement, which still needs final approval, investors appear to be pretty happy that the big card companies seem to be emerging relatively unscathed.
StockTwits traders like what they're seeing
That certainly appeared to be a prescient move.
The mobile payments start-up created by Twitter co-founder Jack Dorsey serves more than 8 million customers a day through its mobile apps. And Square recently landed a major deal with Starbucks (SBUX).
While Square is clearly a dominant force, it's not the only game in town. Just last month, Verizon (VZ), AT&T (T) and T-Mobile announced plans to launch a mobile commerce network, named Isis, in two cities.
That's a good point. What comes up must come down, or something like that. But in all seriousness, when stocks are at the top of their game there's a tendency to start trying to time the fall. But in the case of Visa and MasterCard, they have pretty decent fundamentals.
Earlier this month, Visa reported better-than-expected earnings and saw its price target raised by several analysts. MasterCard also beat on earnings and lowered its expenses. Most recently, MasterCard has been trying to diversify through selective partnerships.
So there still may be some room to run.
Mobile payments seems to have replaced social as the tech phenomenon that everybody is talking about. Privately held Square made waves with its groundbreaking deal a few weeks ago with coffee king Starbucks (SBUX). Wal-Mart (WMT), Target (TGT) and several other prominent retailers have teamed up to create the Merchant Customer Exchange. And Google (GOOG) has big financial and wireless firms such as Citigroup (C), MasterCard (MA) and Sprint (S) MOREPaul R. La Monica - Aug 23, 2012 10:27 AM ET
Not a member yet?Sign up now for a free account
|Millennials explain why they have nothing saved for retirement|
|You won the $1.5 billion Powerball! Here's your tax bill|
|How should I prepare financially to launch my own business?|
|Could you guarantee yourself a Powerball jackpot?|
|Here's how to buy your Powerball ticket online|