Visa Inc. (V)

The model is intermediation between the buyer's bank and the seller's. The fee depends on volume and transaction count rather than on loan size, so default risk stays with the issuing bank. Network costs barely rise with transaction volume — hence an exceptionally high operating margin, rare in any industry.

Growth comes from three sources: displacement of cash, growth in cross-border payments (markedly more profitable than domestic ones) and new services such as tokenisation, fraud protection and bill processing. The cross-border piece is especially sensitive to international tourism and business travel.

The principal risks are regulatory and competitive: caps on interchange fees, national payment schemes, and the growth of instant account-to-account transfers that bypass card networks altogether. Visa pays a small dividend and directs most cash flow into buybacks.