In what can only be described as a battle of heavyweights, Wal-Mart Stores Inc. (WMT) has sued Visa (V) Inc. for $5 billion in damages caused by rate manipulation. The world’s largest retailer claims that its largest card issuer is colluding with banks to fix transaction fees. Wal-Mart is claiming Visa holds a practical monopoly on credit card use because it requires retailers to accept all issuers’ Visa-branded cards, thereby eliminating any benefits the company might receive from competitive pricing. So how does this affect you as an investor? Well, if you’re paying more for every Visa transaction, you have less to invest. More directly, if Wal-Mart wins the law suit, Visa shareholders could see an effect on the company’s bottom line and ultimately its share price. And for a company that’s witnessed 27 percent appreciation in its shares over the last year, the loss of the lawsuit could hurt. In pre-market trading, Visa was down 1.22 percent. Paul Cohen, a spokesman for Visa, declined to comment on the Wal-Mart complaint.
Jim Woods has over 20 years of experience in the markets from working as a stockbroker, financial journalist, and money manager. As well as a book author and regular contributor to numerous investment websites, Jim is the editor of:
Bob Carlson provides independent, objective research covering all the financial issues of retirement and retirement planning. In addition, Bob serves as Chairman of the Board of Trustees of the Fairfax County (VA) Employees’ Retirement System, which has over $2.8 billion in assets.
Hilary Kramer is an investment analyst and portfolio manager with 30 years of experience on Wall Street. Since 2010, Hilary's financial publications have provided stock analysis and investment advice to her subscribers:
Jon Johnson's philosophy in investing and trading is to take what the market gives you regardless if that is to the upside or downside. For the past 21 years, Jon has helped thousands of clients gain success in the financial markets through his newsletters and education services:
Get free access to "Millionaire Maker" Hilary Kramer's latest report 3 Biotech Breakthroughs To Bank On. Simply tell us where to send it in the box below.
*Along with my FREE report, Hilary Kramer's 3 Biotech Breakthroughs to Bank On, please also send Hilary's free weekly e-letter, Trading Desk. We value your privacy. You will not be spammed, ever. Period.