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Buy 5 Mobile Payment Stocks and Hold for Long-Term to Reap Benefits
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The rapid shift from cash to digital transactions, driven by a push toward convenience and security, has led to meteoric growth in mobile payments. The space encompasses a broad spectrum of innovations, including payment infrastructure and software services, as well as virtual wallets and smartcards. As the adoption of digital payment becomes commonplace, the mobile payments market is anticipated to experience meteoric growth in the long term.
Mobile Payments Space Provides a Long-Term Opportunity
A higher Internet penetration rate and increased usage of smartphones contribute to the increased uptake of digital payments. Whether paying for lunch, groceries, or high-end products and services, mobile payments are transforming everyday transactions. In light of the prevailing scenario, it has become inevitable to build an enhanced contactless payments suite or upgrade the existing ones.
Owing to the long-term benefits that such investments provide, the industry players have come up with diversified contactless payment options such as mobile wallets, biometrics and QR codes. Such initiatives will enable the players to solidify their presence in the global digital payments market, boost their customer base and diversify income streams.
This convergence of digital solutions and physical transactions has reshaped the e-commerce and online purchase landscape. Enhanced by 5G, contactless payments are becoming the norm, allowing companies in this space to offer faster, more secure transactions.
This high-growth segment capitalizes on a future where the digital wallet and mobile-first systems dominate. Companies leading this change in payment processing and infrastructure are set to benefit immensely from the ongoing global shift to cashless solutions.
5 Mobile Payments Stocks to Buy for Long-Term Gains
These five stocks have strong growth potential for the rest of 2024 and 2025. These stocks have seen positive earnings estimate revisions in the last 60 days. Each of our picks currently carries ether a Zacks Rank #1 (Strong Buy) or 2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
The chart below shows the stock price performance of our five picks in the past month.
Image Source: Zacks Investment Research
Affirm Holdings Inc.
Affirm Holdings has achieved strong revenue growth through diverse income streams, including merchant network fees, interest from loans and virtual card revenues. In fiscal 2024, AFRM’s revenues increased 46.3% year over year. Improving gross merchandise value and the average balance of loans are driving merchant network revenues and interest income, respectively.
Key partnerships with Apple Pay and Hotels.com play a vital role in AFRM’s expansion. Affirm Holding’s advanced machine learning enhances fraud detection and credit risk assessment, improving personalization and efficiency. Plans to expand into the United Kingdom by fiscal 2025 further broaden AFRM’s geographic footprint.
Zacks Rank #1 Affirm Holding has an expected revenue and earnings growth rate of 29.6% and 50.9%, respectively, for the current year (ending June 2025). The Zacks Consensus Estimate for current-year earnings has improved 43.8% over the last 60 days.
Find the latest earnings estimates and surprises on ZacksEarnings Calendar.
American Express Co.
American Express’ growth initiatives, like launching new products, reaching new agreements and forging alliances, are boosting its revenues. Consumer spending on travel and entertainment, which carries higher margins for AXP, is advancing well. AXP’s solid cash-generation abilities enable the pursuit of business investments and prudent deployment of capital via buybacks and dividends.
Zacks Rank #2 American Express has an expected revenue and earnings growth rate of 8.7% and 13.5%, respectively, for next year. The Zacks Consensus Estimate for next-year earnings has improved 0.1% over the last seven days.
Fidelity National Information Services Inc.
Fidelity National Information Services’ organic growth in the banking and capital market solutions is buoying its results. FIS forecasts net revenues between $10.12 billion and 10.17 billion for 2024. FIS’s strategic focus on digital transformation positions it to leverage global economic changes in the future.
The launch of Atelio expands FIS’ footprint in embedded finance. FIS invests in technology and innovation across high-growth markets, thereby expanding its total addressable market. FIS’ inorganic growth strategy, focus on cryptocurrency and shareholder value-boosting efforts are commendable.
Zacks Rank #2 Fidelity National Information Services has an expected revenue and earnings growth rate of 4.1% and 11.6%, respectively, for next year. The Zacks Consensus Estimate for next-year earnings has improved 0.7% over the last 60 days.
PayPal Holdings Inc.
PayPal Holdings is benefiting from robust growth in total payments volume. Strengthening customer engagement on PYPL’s platform is a major positive. Venmo’s improving monetization efforts and rising adoption rate across various platforms are aiding the total active accounts growth.
The solid momentum of core peer-to-peer and PayPal Checkout experiences is a tailwind. Well-performing merchant services are also positive. The strengthening presence of PYPL in both the United States and international markets is contributing well. Accelerating transaction revenues of PYPL are likely to continue driving the top line.
Zacks Rank #2 PayPal Holdings has an expected revenue and earnings growth rate of 7.7% and 10.9%, respectively, for next year. The Zacks Consensus Estimate for next-year earnings has improved 0.2% over the last 30 days.
The Western Union Co.
The Western Union’s operations benefit from a solid digital arm that has been built through multiple partnerships and significant investments. We expect revenues from North America to stay well above $1.6 billion in 2024. Tactical cost-management efforts are likely to provide an impetus to its margins. Operating margins are expected to be between 19% and 21% for 2024. WU aims to save around $50 million in 2024.
WU’s prudent capital management strategy through share buybacks and dividend payments bodes well. Innovative products, such as Send Now, Pay Later services integrating lending and remittance, position WU for enhanced market penetration.
Zacks Rank #2 The Western Union has an expected revenue and earnings growth rate of 1.2% and 4.8%, respectively, for next year. The Zacks Consensus Estimate for next-year earnings has improved 0.1% over the last 60 days.
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Buy 5 Mobile Payment Stocks and Hold for Long-Term to Reap Benefits
The rapid shift from cash to digital transactions, driven by a push toward convenience and security, has led to meteoric growth in mobile payments. The space encompasses a broad spectrum of innovations, including payment infrastructure and software services, as well as virtual wallets and smartcards. As the adoption of digital payment becomes commonplace, the mobile payments market is anticipated to experience meteoric growth in the long term.
At this stage, we recommend five mobile payments stocks to buy and hold for long term to strengthen your portfolio. These are: Affirm Holdings Inc. (AFRM - Free Report) , American Express Co. (AXP - Free Report) , Fidelity National Information Services Inc. (FIS - Free Report) , PayPal Holdings Inc. (PYPL - Free Report) and The Western Union Co. (WU - Free Report) .
Mobile Payments Space Provides a Long-Term Opportunity
A higher Internet penetration rate and increased usage of smartphones contribute to the increased uptake of digital payments. Whether paying for lunch, groceries, or high-end products and services, mobile payments are transforming everyday transactions. In light of the prevailing scenario, it has become inevitable to build an enhanced contactless payments suite or upgrade the existing ones.
Owing to the long-term benefits that such investments provide, the industry players have come up with diversified contactless payment options such as mobile wallets, biometrics and QR codes. Such initiatives will enable the players to solidify their presence in the global digital payments market, boost their customer base and diversify income streams.
This convergence of digital solutions and physical transactions has reshaped the e-commerce and online purchase landscape. Enhanced by 5G, contactless payments are becoming the norm, allowing companies in this space to offer faster, more secure transactions.
This high-growth segment capitalizes on a future where the digital wallet and mobile-first systems dominate. Companies leading this change in payment processing and infrastructure are set to benefit immensely from the ongoing global shift to cashless solutions.
5 Mobile Payments Stocks to Buy for Long-Term Gains
These five stocks have strong growth potential for the rest of 2024 and 2025. These stocks have seen positive earnings estimate revisions in the last 60 days. Each of our picks currently carries ether a Zacks Rank #1 (Strong Buy) or 2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
The chart below shows the stock price performance of our five picks in the past month.
Image Source: Zacks Investment Research
Affirm Holdings Inc.
Affirm Holdings has achieved strong revenue growth through diverse income streams, including merchant network fees, interest from loans and virtual card revenues. In fiscal 2024, AFRM’s revenues increased 46.3% year over year. Improving gross merchandise value and the average balance of loans are driving merchant network revenues and interest income, respectively.
Key partnerships with Apple Pay and Hotels.com play a vital role in AFRM’s expansion. Affirm Holding’s advanced machine learning enhances fraud detection and credit risk assessment, improving personalization and efficiency. Plans to expand into the United Kingdom by fiscal 2025 further broaden AFRM’s geographic footprint.
Zacks Rank #1 Affirm Holding has an expected revenue and earnings growth rate of 29.6% and 50.9%, respectively, for the current year (ending June 2025). The Zacks Consensus Estimate for current-year earnings has improved 43.8% over the last 60 days.
Find the latest earnings estimates and surprises on Zacks Earnings Calendar.
American Express Co.
American Express’ growth initiatives, like launching new products, reaching new agreements and forging alliances, are boosting its revenues. Consumer spending on travel and entertainment, which carries higher margins for AXP, is advancing well. AXP’s solid cash-generation abilities enable the pursuit of business investments and prudent deployment of capital via buybacks and dividends.
Zacks Rank #2 American Express has an expected revenue and earnings growth rate of 8.7% and 13.5%, respectively, for next year. The Zacks Consensus Estimate for next-year earnings has improved 0.1% over the last seven days.
Fidelity National Information Services Inc.
Fidelity National Information Services’ organic growth in the banking and capital market solutions is buoying its results. FIS forecasts net revenues between $10.12 billion and 10.17 billion for 2024. FIS’s strategic focus on digital transformation positions it to leverage global economic changes in the future.
The launch of Atelio expands FIS’ footprint in embedded finance. FIS invests in technology and innovation across high-growth markets, thereby expanding its total addressable market. FIS’ inorganic growth strategy, focus on cryptocurrency and shareholder value-boosting efforts are commendable.
Zacks Rank #2 Fidelity National Information Services has an expected revenue and earnings growth rate of 4.1% and 11.6%, respectively, for next year. The Zacks Consensus Estimate for next-year earnings has improved 0.7% over the last 60 days.
PayPal Holdings Inc.
PayPal Holdings is benefiting from robust growth in total payments volume. Strengthening customer engagement on PYPL’s platform is a major positive. Venmo’s improving monetization efforts and rising adoption rate across various platforms are aiding the total active accounts growth.
The solid momentum of core peer-to-peer and PayPal Checkout experiences is a tailwind. Well-performing merchant services are also positive. The strengthening presence of PYPL in both the United States and international markets is contributing well. Accelerating transaction revenues of PYPL are likely to continue driving the top line.
Zacks Rank #2 PayPal Holdings has an expected revenue and earnings growth rate of 7.7% and 10.9%, respectively, for next year. The Zacks Consensus Estimate for next-year earnings has improved 0.2% over the last 30 days.
The Western Union Co.
The Western Union’s operations benefit from a solid digital arm that has been built through multiple partnerships and significant investments. We expect revenues from North America to stay well above $1.6 billion in 2024. Tactical cost-management efforts are likely to provide an impetus to its margins. Operating margins are expected to be between 19% and 21% for 2024. WU aims to save around $50 million in 2024.
WU’s prudent capital management strategy through share buybacks and dividend payments bodes well. Innovative products, such as Send Now, Pay Later services integrating lending and remittance, position WU for enhanced market penetration.
Zacks Rank #2 The Western Union has an expected revenue and earnings growth rate of 1.2% and 4.8%, respectively, for next year. The Zacks Consensus Estimate for next-year earnings has improved 0.1% over the last 60 days.