SPECIAL REPORT The Top 7 Stocks for 2024

Fintech Favorites- 3 Stocks Eyeing a December Growth Spurt

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  • These three fintech companies have set themselves apart from competitors in the industry and are ready to soar higher. 
  • Visa (V): Visa is one company that never disappoints, no matter the market situation. 
  • SoFi Technologies (SOFI): SoFi is set to report a profit in 2024 and its upward momentum will double. 
  • Affirm Holdings (AFRM): BNPL is gaining popularity and if the high interest rates persist, Affirm is set to benefit. 
fintech stocks to buy - Fintech Favorites- 3 Stocks Eyeing a December Growth Spurt

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Unlike tech stocks, fintech has had a good year so far. The bank collapse pushed consumers toward fintech companies that are steady and considered reliable. This is one industry that is always transitioning, as we move towards digitization, the demand for credit cards will increase, and as student loan repayment resumes, the demand for personal loans will rise. Companies offering these services will benefit in the coming months, and investing in these three fintech stocks will set you up for growth in December. With that in mind, let’s take a look at the three fintech stocks to buy.

Visa (V)

several Visa branded credit cards
Source: Kikinunchi / Shutterstock.com

Visa (NYSE:V) remains my favorite fintech stocks to buy for growth and it never disappoints. It helps process payments globally and has a strong market share. It has been rewarding shareholders for a long time and runs a business that will continue to generate revenue as the economy improves. With higher consumer spending, we will see Visa go from strong to stronger. Valued at $515 billion, the company has set a benchmark for itself and is one of the top payment processors today.

As of writing, V stock is exchanging hands for $254 and is close to its 52-week high. The stock is up 22% year-to-date and it will continue to thrive even if there is a recession. One solid reason to bet on this stock is the dividend yield. Visa enjoys a dividend yield of 0.81% and pays a quarterly dividend of $0.52. It has raised its dividends since 2008 and is an ideal dividend stock to own.

Now coming to the financial position, Visa doesn’t disappoint here either. In the third quarter, the company reported a net revenue of $32.7 billion and also saw an impressive 9% year-over-year rise in the payment volume. Its net income came in at $17.2 billion, up 15% YOY. I believe the upcoming holiday season will help the company boost numbers, and we could see an even better fourth quarter.

Since the company earns a fee on every transaction users make, it can manage to keep the operating expenses low while generating revenue. Visa will continue ruling the space as we transition towards digital payments and increase the use of credit cards in the coming years.

Fintech stocks to buy: SoFi Technologies (SOFI)

SoFi Technologies, Inc logo with stock market chart background. is an American online personal finance company and online bank.
Source: Poetra.RH / Shutterstock.com

No matter where the economy moves from here, investing in SoFi Technologies (NASDAQ:SOFI) is a smart move. The long-term picture for the fintech company looks attractive. With consumers losing faith in traditional banks, there is a big move towards fintech giants, and SoFi is making the most of it. The company has recently announced that it will be exiting the cryptocurrency business which will work as an advantage in the long term. It will be able to allocate resources to the thriving segments of the business including personal loans.

Its revenue continues to grow and it remains set to report profitability in the first quarter of 2024. SoFi’s financials are strong and it saw the deposits grow to $15.7 billion in 2023 from $7.3 billion last year. It also saw a revenue of $537 million which is up 27% year-over-year. Additionally, it added 717,000 members in the quarter and this is proof that it is moving in the right direction. SoFi has been able to win consumer trust and this will help it expand in the coming years.

Exchanging hands at $7.96 today, the stock is down from the all-time high of $25, and any weakness in the stock is a chance to grab it. 2024 could be a big year for the company with the resumption of student loan payments, and this will lead to a higher demand for personal loans. The company’s revenue growth will continue in the coming quarter and the sooner you invest in the stock, the higher your chance of making a gain.

Cathie Wood’s Ark Investment purchased 200K shares of the stock last week after buying 252K shares earlier in the week. I believe this is only the beginning for SoFi and it certainly has a long way to go.

Affirm Holdings (AFRM)

Smartphone with website of US financial technology company Affirm Holdings Inc (AFRM) on screen with logo Focus on top-left of phone display
Source: Wirestock Creators / Shutterstock.com

While Buy Now Pay Later (BNPL) platforms do not enjoy a strong reputation in the industry, the numbers prove otherwise. We have seen a solid demand for BNPL this year, and Affirm Holdings (NASDAQ:AFRM) is one fintech company that is leading the race. It offers point-of-sale financing for merchants and consumers. Rising inflation has led to a growth in the popularity of BNPL and this has helped Affirm grow.

Trading at $38.56 today, the stock is up 323% year-to-date and 147% in the past six months. It is trading at a 52-week high but looks undervalued to me. A recent report released by Adobe Analytics shows that BNPL purchases have increased 14% year-over-year and they accounted for $7.3 billion in online shopping in November.

In the first quarter of 2024 results, the company managed to beat analyst expectations and also raised the fiscal year outlook. It generated a revenue of $497 million thanks to the partnership with some of the top e-commerce platforms like Shopify (NYSE:SHOP). However, the company isn’t profitable yet and reported a net loss of $172 million which is much lower than the loss of $251 million reported in the prior year period.

The BNPL market is set to grow at a growth rate of over 30% in this decade which means Affirm will benefit as consumer spending improves. Looking at the current market scenario, I am positive that the company’s holiday season earnings will be stellar and it will take the stock closer to $50.

On the date of publication, Vandita Jadeja did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.

Vandita Jadeja is a CPA and a freelance financial copywriter who loves to read and write about stocks. She believes in buying and holding for long term gains. Her knowledge of words and numbers helps her write clear stock analysis.


Article printed from InvestorPlace Media, https://investorplace.com/2023/12/fintech-favorites-3-stocks-eyeing-a-december-growth-spurt/.

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