Mastercard (MA) is having a great start to 2017 with its stock being up 4.87% year to date. The truth is that stock still has plenty of room to run because there are several factors that could bring it higher. The first of which was the earnings report that was posted.

The fourth quarter earnings beat on the EPS but slightly missed on the revenue side. It is not typical for Mastercard to miss on the revenue number, and may have fallen due to unforeseen circumstances. In either case, the prior third quarter report did beat on both the EPS and revenue metric.

The key point to consider is that the stock falling after reporting its most recent fourth-quarter earnings report, should be seen as a buying opportunity. That is because Mastercard still has a large market share to capture that has not yet been tapped.

Mixed Earnings

In its most recent fourth–quarter earnings report Mastercard reported mixed numbers. The earnings per share number was a beat, with the company reporting that it had earned $0.86 per share. This compares to analysts expecting the company to report $0.85 per share. The earnings beat on the EPS side was due to increased holiday spending by consumers. Unfortunately, this didn’t translate to a beat on the revenue side. Revenue for the quarter came in at $2.76 billion, just shy of the $2.78 billion estimate.

What must be realized is that the mixed earnings isn’t always a problem with Mastercard. In the prior third quarter earnings report it had reported an EPS of 1.08 per share on revenue of $2.88 billion. Such a drop quarter over quarter can be blamed on on seasonal adjustments and several other factors. Either way, this is a great buying opportunity.

Mastercard’s stock has been known to gap higher despite not beating earnings for a quarter or two. Back in 2014 the company performed a 10 for 1 stock split. The reason for doing so was to make the stock more accessible to traders. Mastercard’s stock had shot up so much because of momentum. Without a forward stock split the shares would possibly be trading at $1,080 per share today .

Untapped Market

With Mastercard being on the fence in terms of earnings, traders continue to be bullish on the stock. A lot of that has to do with the fact that there are still many untapped markets out there. The company is having a difficult time entering the China market, but might be able to find an opportunity in India. That is because right now in China it has not been able to enter the market. This all has to do with the fact that regulators in China have set strict regulations in order for Mastercard to obtain a license in the country.

Such rules include being locally based, having one billion yuan in a registered business, and meeting the government’s security standards. To date Mastercard is still in talks with Chinese regulators so that it can finally file a license to operate in China.

In the meantime India is wanting to shift away from cash payments to credit card payments. With India being open to the idea of allowing Mastercard into its market, there can be a massive amount of profit to be made. That is because at least 95% of all purchases in India are done in all cash transactions. As the consumers switch to using credit cards as opposed to cash, Mastercard’s profits will start to rise substantially. This is evidenced by the fact that volumes in India are up 75% year over year. Such growth can only get better as consumers switch to using a credit card instead.

What Binary Option Traders Should Watch For

There are quite a few things that traders should watch to determine if Mastercard’s stock will go higher. The first of which involves monitoring earnings growth year over year. There will be some quarters that might come in slightly shy of expectations, but for the most part the company continues low double-digit growth year over year. The second thing that should be monitored would be if the growth in India on credit card volume remains constant. Any deviation away from growth should be looked at closely, because the stock may suffer as a result.

A huge catalyst for Mastercard that should be watched would be how the China situation plays out. If Mastercard is able to get its application through China’s Central Bank and obtain a license that would be highly bullish for the stock. Especially since it can enter the China market which is another huge untapped market to get into. The final thing that traders should keep an eye on is how the stock reacts to any breakthrough news. Considering that the stock has been trading in a range between $84.59 per share $111.07 per share the past 52 weeks, it is important to see if there is any reaction to new developments. It is possible that entering new markets alone may not be enough to move the stock higher.

Traders may want to see the growth numbers in these big markets to determine where the stock will move to next.