Fintech
3 Low-Priced Fintech Stocks You Shouldn’t Underestimate
Fintech stocks are expected to grow rapidly through 2030, so investors should pay attention
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In their hearts, fintech stocks are about leveraging technology to improve and automate the delivery of financial services. Fintech is a shortened portmanteau of financial technology and is often equated with payment technology and other applications that make life easier.
It is an area that is set to continue growing at an annual rate of 16.5% between 2024 and 2032. This rapid growth rate is one of the main reasons why investors are so eager to learn about the best stocks in the sector.
Fintech has lagged the broader market in 2024. While disappointing, it also suggests there is room for a fintech rebound in the future. This somewhat weak performance also suggests there are bargains to be had. There are several low-priced and undervalued opportunities for investors to consider at this point. Let’s take a look at three fintech stocks that appear to be well-positioned at the moment.
Block (SQ)
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To block (London share:square) is one of the founding fathers of the fintech stock segment and is currently priced at a low level.
The company made its name through Square’s point-of-sale systems that give the stock its ticker name. Although Square generated $820 million in gross profits in the first quarter, it is no longer the company’s top priority. Cash App generated $1.2 billion in gross profit in the same period and now defines the company along with its blockchain aspirations.
Regardless of the focus, Block remains financial technology oriented. The company is strongly associated with Bitcoin. Despite investor concerns that Block is spending too much time and money on Bitcoin, it is hard to argue that the company is not primarily interested in financial technology.
It’s also hard to argue with the idea that Block stock is currently cheap. Analysts who follow Block believe its stock is worth more than $87 on average. The shares are currently trading at $63.
Adyen (ADYEY)
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Adyen (OTCMKTS:GOODBYE) is a global processing platform based in the Netherlands and an undervalued fintech stock to consider.
It’s clear that the company is in the midst of a huge opportunity based on its most recent earnings report. That The report showed that Adyen’s revenue grew by 21% in the period on processing volumes which increased by 46%.
The company continues to experience volume acceleration with its large corporate partners. Adyen is the mobile app partner of McDonald’s (London share:MCD) and processes all of its transactions.
Overall, the company’s revenue is expected to grow by around 11% in 2024. However, Earnings growth is expected to outpace revenue growth over the same period, at 29%. Earnings growth is one of the most influential factors in the increase in the market price of a given stock. Therefore, it is reasonable to expect that Adyen could increase in price going forward.
This will be interesting to watch because the stock is down a bit year-to-date. There is definitely some value given the company’s performance. It’s a matter of when the markets choose to recognize that value.
Holding Company (NU)
New participations (London share:NEW) is a stock that has a place in Warren Buffett’s holdings portfolio. Buffett is known to prefer financial securities and this digital banking platform that serves Brazil and parts of Latin America is one he likes.
Nu Holdings is one of many so-called neobanks. They offer a whole host of ancillary services beyond those of traditional banks. It’s one of the reasons Nu Holdings has grown so rapidly, Surpassing the 100 million customer milestone during the first trimester.
That rapid growth and rapid customer acquisition has led to a rapid increase in stock prices since the beginning of the year. NU shares were trading at $8 at the beginning of 2024 and are quickly approaching $13.
These companies are entering all sorts of related industries, including travel and mobile networks. The idea is to build a kind of one-stop shop API that brings more and more banking services into the mobile realm.
As of the date of publication, the responsible editor did not hold (either directly or indirectly) any position in the securities mentioned in this article.
As of the date of publication, Alex Sirois had no (direct or indirect) positions in the securities mentioned in this article. The views expressed in this article are those of the author, subject to InvestorPlace.com rules Publishing Guidelines.
Alex Sirois is a freelance contributor to InvestorPlace whose personal style of stock investing focuses on long-term, buy-and-hold, wealth-building stock picks. Having worked in a variety of industries, from e-commerce to translation to education, and using his MBA from George Washington University, he brings a diverse set of skills through which he filters his writing.