Mastercard Turns on the Cash Tap: Buybacks Boom, Dividends Bloom

Mastercard Incorporated MA just doubled down on rewarding shareholders, rolling out a fresh $14 billion Class A share repurchase authorization while boosting its dividend. The new buyback kicks in once the existing $12 billion program is finished, and as of Dec. 5, 2025, roughly $4.2 billion still remained under that plan.The company also approved a 14% hike in its quarterly cash dividend to 87 cents per share from 76 cents previously. The new payout will be distributed on Feb. 9, 2026, to shareholders of record as of Jan. 9, 2026. Based on the Dec. 9 closing price of $537.55, Mastercard’s dividend yield stands at 0.65%, slightly below the industry average of 0.72%, suggesting meaningful room for future increases as earnings and cash flows scale.The pace of capital returns has been strong. In the last reported quarter, Mastercard repurchased 5.8 million shares for $3.3 billion, and between Oct. 1 and Oct. 27, it bought back another 2.1 million shares for $1.2 billion. It also delivered $687 million in dividends during the third quarter alone. The surge in cash generation is providing the flexibility to keep funding buybacks and growing payouts without straining the balance sheet.Over the trailing twelve months, free cash flow rose 20% to $16.3 billion. The company ended the third quarter with $10.3 billion in cash and equivalents, up 22.2% from year-end 2024. Long-term debt totaled $19 billion, a manageable level considering its earnings trajectory. With expanding operations and robust margins, Mastercard’s capacity for shareholder-focused actions will grow further.Peers’ Shareholder-Friendly ActionsCompanies like Visa Inc. V and American Express Company AXP also have strong capital deployment programs.In fiscal fourth quarter 2025, Visa returned $6.1 billion to shareholders, including $4.9 billion in buybacks and $1.2 billion in dividends, with $24.9 billion still authorized for repurchases as of Sept. 30. American Express repurchased 7 million shares for $2.3 billion in the third quarter of 2025 and paid $600 million in dividends, distributing 82 cents per share in the period. Both companies continued prioritizing shareholder returns through sizable buybacks and steady dividend payouts.Mastercard’s Price Performance, Valuation and EstimatesShares of Mastercard have gained 2.1% year to date, outperforming the broader industry’s 12.6% decline. Image Source: Zacks Investment ResearchFrom a valuation standpoint, Mastercard trades at a forward price-to-earnings ratio of 28.46X, higher than the industry average of 19.96X. Mastercard carries a Value Score of D. Image Source: Zacks Investment ResearchThe Zacks Consensus Estimate for Mastercard’s 2025 earnings implies a 12.6% rise year over year, followed by 15.8% growth next year. Image Source: Zacks Investment ResearchThe stock currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.Zacks Naming Top 10 Stocks for 2026Want to be tipped off early to our 10 top picks for the entirety of 2026? History suggests their performance could be sensational.From 2012 (when our Director of Research Sheraz Mian assumed responsibility for the portfolio) through November, 2025, the Zacks Top 10 Stocks gained +2,530.8%, more than QUADRUPLING the S&P 500’s +570.3%.Now Sheraz is combing through 4,400 companies to handpick the best 10 tickers to buy and hold in 2026. Don’t miss your chance to get in on these stocks when they’re released on January 5. Be First to New Top 10 Stocks >>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 Mastercard Incorporated (MA): Free Stock Analysis Report Visa Inc. (V): Free Stock Analysis Report American Express Company (AXP): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks