Fintech stocks are growing in popularity in the stock market right now. For those new to the term fintech, it is a term used to describe new tech that seeks to improve and automate the delivery and use of financial services. Essentially, it is used to aid companies and consumers in managing their financial operations, processes, and lives by utilizing specialized software and algorithms. Fintech services are transforming the banking system from a branch-specific process to various digital channels.
On top of that, the pandemic has also encouraged consumers to reduce the usage of banknotes to prevent the spread of coronavirus. Traditional banks such as JPMorgan Chase & Co (NYSE: JPM) and Goldman Sachs Group Inc (NYSE: GS) are wary of the importance of fintech. In early April, JPMorgan CEO and chairman Jamie Dimon said, “Banks … are facing extensive competition from Silicon Valley, both in the form of fintech and Big Tech companies.” Hence both companies are not resting on their laurels. In April, JPMorgan Asset Management invested in THE TIFIN GROUP. The company is a fintech platform with ten active operating companies for the asset and wealth management industry.
On the other hand, Goldman Sachs invested in a Turkish fintech company known as DGPays back in March. In conclusion, it is evident that digital payments are rising in popularity and it would be foolish to think otherwise. In light of this, here are four top fintech stocks in the stock market today.Top Fintech Stocks To Buy [Or Sell] This WeekSquare Inc
Square is a financial services and digital payments company that is based in San Francisco. It provides a commerce ecosystem that enables its sellers to start, run, and grow their businesses. In essence, it combines software with hardware to enable sellers to turn their mobile and computing devices into payments and point-of-sale solutions. Therefore, millions of businesses use Square as part of their day-to-day operations. Despite the company stock trading sideways since the start of the year, it is easy to forget that SQ stock has more than doubled in value over the past year. Last week, the company announced its first-quarter earnings report. So let us dive into the numbers that matter.
The company posted net revenue of $5.06 billion, a jump of nearly four-fold. Also, top-line growth was driven by a strong momentum across the Cash App ecosystem that contributed $4.04 billion to net revenues in the reported quarter, up 666% year-over-year. And finally, gross profit grew 79% from the year-ago quarter to $964 million.
On Friday, Square announced three new developer tools at the Unboxed 2021 Conference. This includes early access to Snippet API which enables developers to create plugins that help sellers create engaging online experiences. This extension for Square Online was one of the most requested developer features over the past year. Hence this allows developers to create new, interactive ways to engage their customers online. So could SQ stock be one of the buy-on-dip opportunities in the stock market now?Paypal Holdings Inc
Next on the list, we have a digital payment company, Paypal. In detail, the company operates as a payment processor for online vendors, auction sites, and many other commercial users. By leveraging technology to make financial services and commerce more convenient, it serves over 300 million consumers and merchants all over the world. Paypal is another company that reported an impressive first-quarter earnings report last week. It is noteworthy that it’s the company’s strongest ever first-quarter results in history.
The company posted revenue of $6.03 billion that has beaten analysts’ expectations. First-quarter net profit rose to $1.10 billion from $84 million a year earlier, and the company added 14.5 million net new active accounts, bringing its total user base to 392 million.
In recent news, the company announced plans of acquiring Happy Returns, an online product-returns provider. The company works with retail brands to allow customers to visit “return bars” to send back online purchases without having to box and ship items themselves. This would improve Paypal’s platform and expand its footprint, all to provide customers with a more seamless and friendly way to make and process returns. With digital payments being the way forward, would you buy PYPL stock now?
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Visa is a payments technology company that connects its users to electronic payments. The company enables global commerce through the transfer of value and information among participants. It facilitates electronic funds transfers throughout the world, most commonly through Visa-branded credit cards, debit cards, and prepaid cards.
The company stock has risen over 20% over the past year. In late April, the payments company posted its fiscal second-quarter earnings report. Visa posted revenue of $5.73 billion and net income of $3.0 billion. On top of that, the company saw payment volume grow 11% in the quarter. This goes to show that recovery is well underway after the pandemic has impacted spending trends, especially with international travel largely stalled.
Last week, Visa and Wave, an accounting and business banking platform for small businesses, announced the Canadian launch of Instant Payouts, Wave’s cash flow payments solution for small business owners. This feature integrates Visa Direct directly into Wave’s invoicing and payments platform. Hence allowing customers a new way to access the money they’ve earned within seconds. Rather than waiting for the typical payment processing times, Wave customers can receive funds in real-time. All things considered, would you consider investing in V stock as the economy reopens?
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Finally, we have Mastercard. Similar to Visa, it connects its users across the world, enabling them to use electronic forms of payment. The company allows users to make payments by creating a range of payment solutions and services using its brands. This includes MasterCard, Maestro, and Cirrus. Mastercard is yet another company that announced its earnings report in April. The company beat first-quarter earnings estimates, joining rival Visa as spending and payment volumes continue to recover.
Zooming in the financials, Mastercard boasted revenue of $4.2 billion. On top of that, the company reported a net income of $1.8 billion, up from $1.7 billion, a year earlier. The company expects a second-quarter revenue growth rate, in the high-20s (percentage range), or the low-to-mid 20s on a currency-neutral basis and excluding acquisitions.
In other news, the company has also partnered with cryptocurrency exchange Gemini to launch a crypto rewards credit card. Card users will receive up to 3% in Bitcoin or other cryptocurrencies on their purchases. Given the growth potential of the company, would this be an opportunity to invest in MA stock now?