MA
Mastercard Incorporated
Financial Services · Credit Services · United States · Stock
Score Breakdown
Scored for Dividend Income profile
Sub-scores are 0–20 each; Model Score is weighted by your selected investment goal. How it works →
Why Ranked Here
- Mastercard earned a perfect profitability score on the strength of its 45.6% net margin, 57.6% operating margin, and 193.5% return on equity, which are among the highest achievable in any industry.
- Consistent double-digit growth in revenue, net income, and EPS alongside a steadily rising dividend with a very low 18.4% payout ratio supported strong scores in both the growth and dividend factors.
- The composite score of 72.3 reflects the combination of these strengths alongside a moderate financial health score driven by the 2.46 debt-to-equity ratio and a zero contribution from the theme factor under the current model methodology.
Why Not Higher
- The debt-to-equity ratio of 2.46 tempered the financial health score to a moderate level, preventing a top-tier rating despite very strong interest coverage of 27.8x.
- The theme factor contributed zero points to the composite score, and the slight 2026Q1 pullback in revenue and net income from 2025Q4 peaks kept the momentum score below the maximum.
Data Confidence
10 / 10
Very High — full data coverage
Why This Score
Grounded in figures from this company's SEC EDGAR filings — not a restatement of the score itself.
Revenue grew from $28,167,000,000 in FY2024 to $32,791,000,000 in FY2025 (+16.4%), net income rose from $12,874,000,000 to $14,968,000,000 (+16.3%) over the same period, and diluted EPS expanded from $13.89 to $16.52 (+18.9%) from FY2024 to FY2025.
The model rewarded consistent double-digit growth across revenue, net income, and EPS, with EPS outpacing top-line growth due to share count reduction, reflecting high-quality earnings expansion that fell just short of a perfect score.
In FY2025, Mastercard posted a net margin of 45.6%, an operating margin of 57.6%, and a return on equity of 193.5%.
These metrics reflect an exceptionally capital-efficient, high-margin business model; the model awarded a perfect score in recognition of margins and returns that are among the highest achievable in any industry.
In FY2025, Mastercard carried a debt-to-equity ratio of 2.46, while its interest coverage ratio (operating income divided by interest expense) stood at 27.8, and total assets were $54,157,000,000.
The model balanced a relatively elevated leverage ratio against very strong interest coverage, indicating that while debt levels are meaningful relative to equity, earnings comfortably service that debt; the combination produced a moderate rather than top-tier health score.
Revenue trended upward from $8,133,000,000 in 2025Q2 to a peak of $8,806,000,000 in 2025Q4 before easing to $8,398,000,000 in 2026Q1; net income followed a similar arc from $3,701,000,000 in 2025Q2 to $4,060,000,000 in 2025Q4 and then $3,882,000,000 in 2026Q1; operating income rose from $4,777,000,000 in 2025Q2 to $5,061,000,000 in 2025Q3 and then stabilized near $4,910,000,000 in 2025Q4 and $4,907,000,000 in 2026Q1.
The model recognized a broadly positive multi-quarter trend across all three metrics, with the slight pullback in 2026Q1 from peak levels tempering the score below the maximum.
Mastercard's dividends per share have grown consecutively from $2.04 in FY2022 to $2.37 in FY2023, $2.74 in FY2024, and $3.15 in FY2025, while the dividend payout ratio in FY2025 stood at 18.4%.
The model rewarded a consistent multi-year dividend growth trajectory alongside a low payout ratio, which signals that the dividend is well-covered by earnings and has substantial room to continue growing, producing a near-perfect score.
Mastercard is assigned to the macro theme of Digital Payments & Fintech Infrastructure.
Although Mastercard is assigned to the Digital Payments & Fintech Infrastructure theme, this assignment did not translate into a score under the model's current methodology; the theme assignment itself remains a factual characteristic of the security regardless of the score outcome.
Research Summary
AI-generated analysis reflects data and conditions as of the report date shown above. Verify any specific figures through primary sources before acting on this analysis.
Mastercard delivered exceptional financial performance in FY2025, with revenue growing 16.4% to $32.8 billion and net income rising 16.3% to nearly $15 billion, while diluted EPS expanded an even faster 18.9% to $16.52 due to share count reduction. The company's profitability metrics are among the best in any industry, with a net margin of 45.6%, an operating margin of 57.6%, and a return on equity of 193.5%. Quarterly momentum has been broadly positive through the trailing four quarters, and Mastercard's dividend has grown consecutively every year from $2.04 in FY2022 to $3.15 in FY2025, supported by a very low payout ratio of 18.4% that leaves ample room for continued dividend growth. A moderately elevated debt-to-equity ratio of 2.46 is the primary financial health consideration, though an interest coverage ratio of 27.8x demonstrates that earnings comfortably service that debt.
Plain English
Mastercard is a highly profitable payments company that keeps growing its revenues and earnings at double-digit rates, pays a steadily rising dividend that barely dents its profits, and runs its business with margins that most companies can only dream about — the main thing to watch is that it carries a meaningful amount of debt relative to its equity, though it earns far more than enough to cover the interest.
Bull Case vs. Bear Case
Bull Case
- Mastercard's profitability is extraordinary: a 45.6% net margin, 57.6% operating margin, and 193.5% return on equity in FY2025 reflect a capital-light, high-margin business model that generates exceptional returns for shareholders.
- Revenue, net income, and EPS all grew at double-digit rates in FY2025 — 16.4%, 16.3%, and 18.9% respectively — with EPS outpacing top-line growth due to share count reduction, signaling high-quality earnings expansion.
- The dividend has grown every year from $2.04 in FY2022 to $3.15 in FY2025, and with a payout ratio of only 18.4%, there is substantial room for continued dividend increases without straining earnings.
Bear Case
- Mastercard's debt-to-equity ratio of 2.46 in FY2025 is relatively elevated, meaning the balance sheet carries meaningful leverage that could become a concern if earnings were to deteriorate.
- Quarterly revenue and net income pulled back in 2026Q1 from their 2025Q4 peaks — revenue fell from $8,806 million to $8,398 million and net income from $4,060 million to $3,882 million — introducing some uncertainty about whether peak growth rates are sustainable.
- The theme factor contributed zero points to the composite score under the model's current methodology, limiting the total score despite Mastercard's clear positioning in the Digital Payments & Fintech Infrastructure space.
What Could Change the Picture
Bullish Triggers
- A re-acceleration of quarterly revenue and net income back above 2025Q4 peak levels would confirm that the 2026Q1 pullback was temporary and strengthen the growth narrative.
- A reduction in the debt-to-equity ratio while maintaining the current interest coverage strength would upgrade the financial health assessment and could push the composite score higher.
Bearish Triggers
- A sustained decline in quarterly operating income below the ~$4,900 million range observed in 2025Q4 and 2026Q1 would signal that margin pressures are emerging and could weaken the profitability and momentum factors.
- A significant increase in leverage beyond the current 2.46 debt-to-equity ratio without a corresponding rise in interest coverage would raise financial health concerns and could shift the risk profile.
Risk Profile
Low RiskMastercard's primary financial risk is its relatively elevated debt-to-equity ratio of 2.46, though this is substantially mitigated by an interest coverage ratio of 27.8x, indicating that operating income covers interest expense nearly 28 times over. On the momentum side, the modest sequential decline in revenue and net income in 2026Q1 from 2025Q4 peaks warrants monitoring but does not yet represent a meaningful trend reversal.
This report is for educational and research purposes only. It does not constitute financial, investment, legal, or tax advice — always conduct your own due diligence before making investment decisions.