How much stock did Visa purchase in the last year?

For card payment giantsVisa (NYSE: V)We can say this: it is not shy about spending money on shareholder-pleasing measures. The company regularly allocates large sums of money to buy back its own stock.

Visa's stock purchases have been significant, amounting to $12.7 billion last year. Let's take a look at the specifics behind Visa's buyback, and what they tell us about the company.

Last year, the company bought nearly 54 million shares.

In total, $12.7 billion was spent on 53.9 million shares. Broken down over four quarters, Visa purchased between 10 million and 17 million shares each quarter, at a total cost of $2.2 billion to $4.1 billion.

In addition, Visa is a consistent (though not particularly generous) dividend payer, with a quarterly dividend of about $1 billion. As a result, the company's quarterly share price boost will amount to $3 billion. How can it afford such high expenses on a regular basis?

The answer: strong free cash flow (FCF). You see, while the Visa name is easily associated with credit cards, the company doesn't offer any credit to credit card holders. Instead, Visa is a brand that acts as a payment processor (or, in the case of debit cards, directs the cardholder's available funds) between the consumer and the card issuer, which is actually the financial institution that extends credit to the credit card.

The supreme intermediary.

As a result, Visa is essentially a highly profitable middleman. Because of this, Visa's profit margins are almost uniformly high (an enviable 52% in FY2023), and its FCFs are huge (close to $20 billion in the current fiscal year).

That's why investors should consider Visa when looking for rock-solid blue chip stocks in the financial sector. Consumers around the world are not going to stop using Visa plastic cards, and old-fashioned cash transactions are being replaced by new technology. Barring some kind of wild goose chase, Visa will certainly remain a dominant industry player for many years to come.

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Eric Volkman does not own any of the shares listed above.The Motley Fool holds a recommended Visa.The Motley Fool has a disclosure policy.

How much stock has Visa purchased in the past year?