http://www.sfgate.com/cgi-bin/article.cgi?f=/c/a/2008/02/28/BUAJV9OHP.DTL

When payment rival MasterCard went public two years ago, it sold shares at a price about 15 times its earnings. Since then, the stock has roughly quintupled. Factor in MasterCard's profit gains in the intervening years, and shares now trade at approximately 22 times earnings.

The MasterCard example is coloring everything about the Visa IPO.

Visa's underwriters figure that MasterCard set its IPO price too low. They're pegging Visa's offering not to what MasterCard sold for two years ago, but rather to where MasterCard stock stands today. Visa's indicated IPO price between $37 and $42 per share would put it at about the same value as the roughly 22 times earnings that MasterCard stock sells for now.

What that means is that the Visa IPO won't be as cheap as MasterCard. Visa buyers are not likely to see the kind of outsized gains in the first few years after the company goes public that investors in the MasterCard offering did. And if Visa's IPO price were to climb above the indicated range, the deal would become increasingly expensive and correspondingly more risky.

Looks like the small investor will be left out in the cold on this one. I'm not buying at the IPO price and certainly not above the IPO price. I will be content to watch this one - intently. A better play might be MA if a lot of MA stock holders sell and move to V. Should be fun to watch this all unfold.