After the close Thursday, Visa (V) reported earnings of $2.41 a share (after adjusting for one-time items) for the December 2023 quarter. (That’s the company’s fiscal first quarter.) Analysts had been looking for $2.34 a share in adjusted earnings. Revenue grew 8.8% to $8.63 billion, again beating analyst forecasts for $8.55 billion in revenue. Visa said payments volume grew 8%, and that its processed transactions rose 9% in the period.

And yet the stock was down $4.70 a share, or 1.72%, to $267.91 at the close today, Friday, January 26.

Why?

Two reasons.

Guidance for the year ahead. The company told investors to expect an increase in annual operating expenses in the low double digits. The company had earlier issued guidance for an increase in operating expenses in the high single digits. And Visa said it now sees 2024 annual net revenue growth in the low double digits compared with its prior view of high single digits to low double digits.

And the effect of a priced-for perfection market. The shift in guidance for expenses and revenue was not especially large. In some markets I think it would have been seen as insignificant. But this isn’t “most markets.” With the Standard & Poor’s 500 and NASDAQ (Composite and 100 indexes) trading at all-time record highs, the slightest mis-step in quarterly results gets punished. The stock was up from the 52-week low of $208.71 and has gained 15.7% in the last three months, and trades with a price to earnings ratio of 30.9. I don’t see any reason to think that the core growth trends in Visa’s business have changed. (Lower inflation, ironically, does lead to lower revenue growth. Companies don’t report inflation adjusted revenue or earnings figures. Visa does report payment volumes in constant, that is inflation-adjusted, dollars. Payments volume increased 8% year over year in constant dollars with cross-border volume up 16% and processed transactions rising 9%.)

I added Visa to my long-term 50 Stocks Portfolio on April 28, 2022. The position is up 21.2% as of the close on January 26. The stock is also a member of my 12-18 month Jubak Picks Portfolio where it is up 324.6% since the start of that position on November 5, 2014.