Visa Inc.'s profit estimates were raised last week by Goldman Sachs Group Inc., which said the payments company's earnings growth "remains intact."
Visa and rival MasterCard Inc. are best positioned to capitalize on growth in electronic payments, and regulatory threats to their revenue are "expected to be marginal," analyst Julio Quinteros Jr. wrote in a research note Friday. Goldman Sachs added Visa to its "conviction buy" list.
Goldman Sachs raised its estimate for Visa's full-year 2010 earnings per share to $3.88, from an earlier estimate of $3.78.
The firm also said Visa may earn $4.75 a share in 2011, increasing its previous earnings estimate by 17 cents.
Visa and MasterCard face a regulatory proposal that many observers expect would cap the fees that merchants pay to accept debit cards from customers.
The measure is part of the financial-overhaul bill moving through Congress and would empower the Federal Reserve to set debit interchange rates that are "reasonable and proportional" to the cost of processing debit transactions.
"There are still various moving parts to be resolved on the regulatory front," Quinteros wrote in the research note.
"However, the impact of those developments is months away and is expected to be marginal, while the near-term earnings season should provide us with a reminder on what makes these models attractive investment vehicles — namely, the robust earnings growth and returns."
Shares of Visa, which is scheduled to report its fiscal third-quarter results on July 28, were trading at $76.68 at midday Friday, up 2.13% from Thursday's closing price. The payments company's shares have fallen 12% to date this year.