Can Mastercard's VAS Business Sustain Its Double-Digit Growth?

Mastercard Incorporated MA continues to strengthen its Value-Added Services and Solutions (VAS) business, making it an increasingly important part of the company’s growth strategy. VAS’ net revenues increased 20% year over year in the second quarter of 2026, accounting for 41.2% of total net revenues and underscoring its growing contribution to the company’s top line.

Security remains a key growth driver for the VAS business as payment fraud and digital threats become more sophisticated. MA is expanding its capabilities across cybersecurity, authentication and fraud prevention while using data and artificial intelligence to address evolving risks. Its Merchant Trust Services offering, for example, uses AI to help identify potentially fraudulent merchants, adding another opportunity to deepen customer relationships.

MA is also broadening VAS through consumer engagement, personalization, digital services and data-driven solutions. Around 60% of VAS net revenues are linked to the company’s payment network, allowing Mastercard to combine its transaction infrastructure with additional services. Its Advantage Partner program, which has more than 200 partners, further expands the range of solutions available to customers.

However, sustained growth will likely depend on continued demand for cybersecurity, data and AI solutions, along with Mastercard’s ability to expand cross-selling opportunities across its customer base. With VAS already rising at a double-digit rate and benefiting from several structural trends, the business could remain a key source of revenue growth while supporting MA’s broader strategy of increasing the value generated from each relationship. We expect VAS net revenues to rise 17% year over year in 2026.

How Are Competitors Faring?

Some of MA’s competitors in the value-added services include Visa Inc. V and American Express Company AXP.

Visa is also expanding its VAS portfolio across issuing, acceptance, risk and security, and advisory services. V continued investing in AI, cybersecurity and digital solutions to broaden its services opportunity. In the third quarter of fiscal 2026, VAS revenues rose 34% year over year in constant dollars and now account for roughly one-third of total company revenues.

American Express is steadily strengthening its value-added services through fraud protection, merchant analytics, digital payments, loyalty programs and AI-enabled tools. AXP’s closed-loop network provides rich transaction data, helping deepen customer engagement, improve merchant outcomes and reinforce its differentiated payments ecosystem.

Mastercard’s Price Performance, Valuation & Estimates

In the year-to-date period, MA’s shares have risen 1.8% against the industry’s fall of 3.7%.

Image Source: Zacks Investment Research

From a valuation standpoint, MA trades at a forward price-to-earnings ratio of 26.54, above the industry average of 19.18. MA carries a Value Score of D.

Image Source: Zacks Investment Research

The Zacks Consensus Estimate for Mastercard’s 2026 earnings implies 16.8% growth from the year-ago period.

Image Source: Zacks Investment Research

Mastercard currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Research Chief Names "Single Best Pick to Double"

From thousands of stocks, 5 Zacks experts each have chosen their favorite to skyrocket +100% or more in months to come. From those 5, Director of Research Sheraz Mian hand-picks one to have the most explosive upside of all.

This company targets millennial and Gen Z audiences, generating nearly $1 billion in revenue last quarter alone. A recent pullback makes now an ideal time to jump aboard. Of course, all our elite picks aren’t winners but this one could far surpass earlier Zacks’ Stocks Set to Double like Nano-X Imaging which shot up +129.6% in little more than 9 months.

Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report

This article originally published on Zacks Investment Research (zacks.com).

Zacks Investment Research