Sometimes the best earnings preview is somebody else's earnings report. That's roughly the situation for Mastercard Inc. (MA), which reports third-quarter results Thursday, and which got a friendly nod from JPMorgan on Tuesday.

Analyst Tien-tsin Huang kept an Overweight rating on Mastercard, arguing the payments giant could benefit from resilient consumer spending, accelerating international transactions and strong demand for cybersecurity services. The setup, in his view, looks favorable heading into Thursday.

The catalyst for that view was Visa Inc. (V), which reported fourth-quarter results and, despite a slightly negative after-hours market reaction, offered encouraging signals for its smaller rival.

JPMorgan's read: Visa's challenges, particularly higher client incentives and operating expense growth, look company-specific rather than signs of broader weakness in the payments industry. In other words, don't blame the whole pool because one swimmer got a cramp.

Strong Consumer Spending Supports Mastercard

The numbers out of Visa were, by and large, sturdy. U.S. domestic purchase volume grew 10%, while cross-border transaction volume rose 14% on a constant-currency basis, accelerating 1 percentage point sequentially.

That acceleration matters because JPMorgan and Wall Street had anticipated a 1-percentage-point slowdown in Mastercard's cross-border volume growth. Instead, the industry data pointed the other way.

Visa's global purchase volume also increased 10%, while revenue grew 12% organically on a constant-currency basis.

JPMorgan expects Mastercard's third-quarter revenue growth to remain stable sequentially, though historical earnings trends suggest potential upside. Both payment networks have historically reported revenue growth roughly 2 percentage points above consensus estimates, according to the firm.

Cybersecurity Business Offers Another Growth Catalyst

Then there's the part of the business that isn't strictly about swiping cards. Visa's value-added services revenue increased 31% on a constant-currency basis, supported by demand for security and cybersecurity solutions.

JPMorgan estimates that security-related offerings account for more than 40% of Mastercard's value-added services revenue, positioning the company to benefit from similar demand trends.

The firm also expects Mastercard to face less pressure from customer incentives than Visa. About 25% of Visa's payment volume is subject to contract renewals in fiscal 2026, compared with approximately 20% for Mastercard, according to JPMorgan. That difference could help Mastercard avoid some of the incentive-related pressures affecting its larger rival.

JPMorgan Sees Favorable Earnings Setup

None of this is a slam dunk. JPMorgan cautioned that Mastercard could have limited revenue upside if its growth trends closely mirror Visa's results. The firm also noted that Mastercard's historical organic revenue growth advantage of roughly 2 percentage points over Visa has narrowed in recent quarters.

Still, JPMorgan sees a mildly positive risk-reward profile heading into Thursday's earnings report, supported by healthy spending trends and potentially fewer company-specific headwinds. The analysts believe Mastercard shares could respond positively to Visa's results as investors distinguish broader industry strength from challenges specific to Visa.

Mastercard Earnings and Analyst Outlook

Mastercard is preparing to report third-quarter earnings Thursday, Oct. 29.

Analysts expect earnings of $5.16 per share, up from $4.38 a year earlier. Revenue is projected to reach $9.65 billion, compared with $8.60 billion in the year-ago quarter.

The stock carries a consensus Buy rating, with an average price forecast of $674.73. Recent analyst actions include:

• Truist Securities maintained a Buy rating and raised its price forecast to $674 on Oct. 23.
• Baird maintained an Outperform rating and raised its price forecast to $710 on Oct. 9.
• RBC Capital Markets maintained an Outperform rating and raised its price forecast to $696 on Aug. 31.

Price Action

Mastercard shares were up 0.51% at $612.99 and Visa shares were up 0.09% at $402.23 at the time of publication on Wednesday, according to market data.