Munger Mode rating: 4 out of 5 — Buy. Our own rating from the research report below, on business quality first: moat durability and management, with price separating the top three.
We have spent our lives looking for businesses that sit astride a river of commerce and collect a small toll on every boat that passes, with no need to build more boats. Mastercard is one of the purest examples we have ever studied. It touches $11 trillion of spending a year, keeps about 30 basis points of it as net revenue, converts more than half of that revenue into operating profit, and needs less than 2 cents of capital spending per dollar of sales to do so. The moat is a two-sided network that took sixty years to build and cannot be bought at any price. Management is capable, disciplined, and honest in its reporting, though we would like to see more of its own money in the stock. What keeps this from five stars is simply the price. At 31 times trailing earnings and about 28 times what we expect for 2026, the market is paying fair value for the compounding it expects.
Recent filings analysed: 8-K (2026-07-30), 10-Q (2026-07-30), 8-K (2026-06-17), 8-K (2026-06-08).
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