Money runs the world, and innovative companies built to handle money are almost always assured of success. Fintech, the intersection between traditional finance and technology, is a particularly winning recipe for companies.
Fintech companies take advantage of technology to offer users faster and more secure services, from payments and lending to crypto and digital banking. With this ongoing digitization of money, the only barrier between the average fintech company and success is how far it’s willing to push the boundaries to offer customers and investors the best value.
The best time to buy fintech stocks is when they’re having temporary price dips. But you only want to buy into a fintech company that has demonstrated a solid business model and a competitive edge in the market.
Here are three such fintech stocks to consider buying on the dip this month.
Coinbase (COIN)
Coinbase (NASDAQ:COIN) stock price surged over 53% year-to-date (YTD) on the back of several pivotal events in crypto.
The U.S. Securities and Exchange Commission (SEC) finally gave the nod to spot exchange-traded funds (ETFs) for Bitcoin (BTC-USD) and Ethereum (ETH-USD). Bitcoin also hit a fresh all-time high of $73,084 and led altcoins in a crypto bull run in March.
The nature of the crypto market is such that it’s cyclical, meaning it undergoes ups and downs over time. That means Coinbase is still primed for more gains as we go into the second half of the year and beyond, and is one of the best fintech stocks to keep an eye out for.
Coinbase was the second largest crypto exchange in the world next to Binance, until recently, and is still the biggest and most successful one in the U.S. It has users in over 100 countries and $330 billion in safeguarded assets.
LendingClub (LC)
LendingClub (NYSE:LC) topped analyst expectations for earnings per share (EPS) and revenue for the first quarter of this year. EPS came at 11 cents and revenue at $180.69 million vs. analysts’ projection of $173.88 million.
Also, LendingClub’s share price is up more than 20% YTD. That also comes on the back of 12 consecutive years of GAAP profitability for the San Francisco-based firm. That’s an impressive performance for a company in the risky niche of lending.
That strong performance is likely to continue for LendingClub, especially after a cost-cutting measure last year that it projected would “result in an annualized run-rate compensation and benefits savings of approximately $30 to $35 million” for its fourth quarter compared to its second quarter for that year.
Those factors have proven persuasive for Wall Street analysts, who have overwhelmingly rated the company’s shares a Buy. LendingClub makes a strong contender for the most promising fintech stocks to buy in July.
Marqeta (MQ)
Shares of Marqeta (NASDAQ:MQ) have shed 24% this year due to its mixed first-quarter results. For instance, the card payments platform racked up a total processing volume of $67 billion, up 33% year-over-year but witnessed a 46% and 6% decline in net revenue and gross profit, respectively.
It blamed the drop in revenue on a low take rate and an accounting change due to a contract with Cash App that went into effect in July last year.
However, this change impacts how revenue is recognized. However, it doesn’t reflect operational performance or Marqeta’s strong growth trajectory as evidenced by its dramatic jump in processing volume over the last year.
Moreover, Bank of America’s (NYSE:BAC) Cassie Chan believes the firm could expand its business even further if it introduces a credit card. That would allow it to penetrate the market further and tap into new revenue streams.
Another positive factor going for Marqeta is that analysts are bullish on its stock, with 11 Buy recommendations out of 17. It’s definitely one of the best stocks to buy on the dip this season.
On the date of publication, Hope Mutie did not have (either directly or indirectly) any positions in the stocks mentioned in this article. The opinions expressed in this article are those of the writer, subject to InvestorPlace.com’s Publishing Guidelines.
On the date of publication, the responsible editor did not have (either directly or indirectly) any positions in the securities mentioned in this article.
