MasterCard, a world’s second-largest payment system, hiked its regular quarterly dividend by 45.5% to 16 cents per share. The increased dividend brings the annual dividend to 64 cents per share implying dividend yield of 0.7%. Alongside this hike, the board of MasterCard sanctioned a new share repurchase program worth $3.75 bn, higher than the $3.5 bn authorized in December, 2013. Including $275 mn from the last approval, currently the company has $4.025 bn worth of shares available for buybacks. Going forward, the improved outlook for card spending, cross-border volumes, gross dollar value (GDV) and payment volume generation given the recent strategic alliances, improving global economies and rapidly growing digital payments are likely to improve the company’s financials, in my opinion. Notably, global card spending on credit and debit cards have witnessed at least high single-digit growth for most of 2014, also boosting cross-border volumes, which is a key revenue driver for card giants. Given the onset of the holiday season, I also expect improved transaction volumes and digital payments as shopping and travelling would be on cards for most global citizens. Moreover, about seven acquisitions (one awaiting closure) in 2014 have further strengthened the company’s long-term inorganic growth profile, without risking the capital. These factors will likely maintain lucrative shareholder returns and retain market confidence. With target price of USD 95, shares of MasterCard, I believe, represent an interestin medium-term investment opportunity. $MA, Mastercard Incorporated / 1440