In this article, we discuss 5 best fintech stocks to buy after the selloff. If you want to read about some more fintech stocks, go directly to 12 Best Fintech Stocks to Buy After the Selloff.
5. Sea Limited (NYSE:SE)
Number of Hedge Fund Holders: 65
Sea Limited (NYSE:SE) engages in the digital entertainment, e-commerce, and digital financial service businesses. It is one of the best fintech stocks to invest in. Media reports indicate that the company is preparing to let go 3% of Shopee employees in Indonesia. The move is part of a broader wave of regional job cuts intended to curb ballooning losses and win back investors.
On August 17, Citi analyst Alicia Yap maintained a Buy rating on Sea Limited (NYSE:SE) stock and lowered the price to $129 from $145, highlighting that the suspension of e-commerce fiscal 2022 revenue guidance raised concerns on the growth prospects for the firm beyond macro and currency headwinds.
At the end of the second quarter of 2022, 65 hedge funds in the database of Insider Monkey held stakes worth $2.7 billion in Sea Limited (NYSE:SE), compared to 77 in the previous quarter worth $5.1 billion.
In its Q1 2022 investor letter, Baron Funds, an asset management firm, highlighted a few stocks and Sea Limited (NYSE:SE) was one of them. Here is what the fund said:
“Sea Limited (NYSE:SE), a global digital gaming and e-commerce company, detracted from performance for the period held. Similar to other online consumer businesses, Sea faced significant multiple compression in the quarter, exacerbated by a slowdown in user growth at its key Free Fire digital game and mounting investments in its e-commerce operation, particularly in new markets like Brazil. We exited our position as we lost confidence in the long- term unit economics in some of Sea’s new markets and were concerned by the simultaneous slowdown in revenue growth and increase in underlying cash burn.”
4. Block, Inc. (NYSE:SQ)
Number of Hedge Fund Holders: 72
Block, Inc. (NYSE:SQ) creates tools that enable sellers to accept card payments and provides reporting, analytics, and next-day settlement. It is one of the top fintech stocks to invest in. On October 5, the Afterpay unit of the firm announced that it had broadened the Buy Now, Pay Later offering to include an option for monthly payments on purchases of between $400 and $4,000.
On August 8, investment advisory Mizuho maintained a Buy rating on Block, Inc. (NYSE:SQ) stock and lowered the price target to $125 from $135. Analyst Dan Dolev issued the ratings update.
Among the hedge funds being tracked by Insider Monkey, Florida-based investment firm ARK Investment Management is a leading shareholder in Block, Inc. (NYSE:SQ), with 9.1 million shares worth more than $799 million.
In its Q2 2022 investor letter, Baron Funds, an asset management firm, highlighted a few stocks and Block, Inc. (NYSE:SQ) was one of them. Here is what the fund said:
“Block, Inc. (NYSE:SQ) provides point-of-sale technology to small businesses and operates the Cash App ecosystem of financial services for individuals. Shares fell due to mixed quarterly results with more modest growth in the Seller business offsetting strength in Cash App. While integration of recently acquired Afterpay is progressing well and credit metrics remain healthy, the buy-now-pay-later business slowed due to greater competitive intensity. We continue to own the stock due to Block’s long runway for growth, sustainable competitive advantages, and unique corporate culture.”
Given this cash-generation power, we are naturally drawn to what we believe are strong and profitable financial institutions when the price is right. Presently, we believe the valuations of our financial holdings are not only reasonable, but extremely compelling, and our portfolio composition reflects this view. Representative financial holdings in the Fund includes Wells Fargo.”
3. PayPal Holdings, Inc. (NASDAQ:PYPL)
Number of Hedge Fund Holders: 97
PayPal Holdings, Inc. (NASDAQ:PYPL) operates a technology platform that enables digital payments on behalf of merchants and consumers worldwide. It is one of the elite fintech stocks to invest in. In late August, the company announced that it would be teaming up with National Philanthropic Trust and Vanguard Charitable to launch Grant Payments. The product allows Donor-Advised Fund sponsors, community foundations, and other grantmakers to deliver grants to charities electronically via the payments system of PayPal.
On September 26, Canaccord analyst Joseph Vafi maintained a Buy rating on PayPal Holdings, Inc. (NASDAQ:PYPL) stock with a price target of $160, citing the upcoming Pay with Venmo launch on Amazon as the next catalyst for PayPal shares.
Among the hedge funds being tracked by Insider Monkey, Washington-based investment firm Fisher Asset Management is a leading shareholder in PayPal Holdings, Inc. (NASDAQ:PYPL), with 17 million shares worth more than $1.2 billion.
In its Q2 2022 investor letter, Mayar Capital, an asset management firm, highlighted a few stocks and PayPal Holdings, Inc. (NASDAQ:PYPL) was one of them. Here is what the fund said:
“This quarter, we bought shares in PayPal (NASDAQ:PYPL), the payments platform. PayPal has been one of the more high-profile victims of the market’s brutal ruthlessness over the past few months, and the stock fell by over two thirds between its peak in July to the beginning of March this year. As we progressed PayPal through the Mayar Checklist Process, we identified a business with a leadership position in a structurally growing market.
The company benefits from certain network effects, and faces several competitive threats at the same time. As the business profited from the move to online retail during the pandemic, as well as from the stimulus cheques handed out in the US, the stock price soared to absurd levels. As so often happens, however, the market had overcorrected by February and this quarter was offering prospective shareholders prices that assumed essentially zero growth in the business. When life gives you irrational sellers, make lemonade!”
2. Mastercard Incorporated (NYSE:MA)
Number of Hedge Fund Holders: 109
Mastercard Incorporated (NYSE:MA), an American financial technology company, provides transaction processing and other payment-related products and services worldwide. It is one of the premier fintech stocks to invest in. On October 4, the company revealed that it would be launching a new tool that will help banks find and block suspicious transactions from crypto exchanges. The tool, named Crypto Secure, is a software that uses artificial intelligence algorithms as well as data from blockchains.
On August 1, investment advisory BMO Capital maintained an Outperform rating on Mastercard Incorporated (NYSE:MA) stock and raised the price target to $422 from $402. Analyst James Fotheringham issued the ratings update.
In its Q2 2022 investor letter, Baron Funds, an asset management firm, highlighted a few stocks and Mastercard Incorporated (NYSE:MA) was one of them. Here is what the fund said:
“The Fund’s holdings in the Payments and Information Services themes also contributed to relative performance. Within Payments, lower exposure to this lagging theme and outperformance of Mastercard Incorporated (NYSE:MA) added the most value. These global payment networks are viewed as safe havens during market downturns but are also benefiting from resilient payment volumes and a sharp rebound in international travel.”
1. Visa Inc. (NYSE:V)
Number of Hedge Fund Holders: 166
Visa Inc. (NYSE:V) operates as a payments technology company worldwide. It is one of the most prominent fintech stocks to invest in. On October 6, the company announced that TD Securities, a subsidiary of TD Bank, had taken part in a cross-border business-to-business payments network. The move was part of a broader effort to make the global payments process easier and faster for corporate clients.
At the end of the second quarter of 2022, 166 hedge funds in the database of Insider Monkey held stakes worth $24 billion in Visa Inc. (NYSE:V), compared to 159 in the preceding quarter worth $28.1 billion.
In its Q2 2022 investor letter, Lakehouse Capital, an asset management firm, highlighted a few stocks and Visa Inc. (NYSE:V) was one of them. Here is what the fund said:
“It was business as usual for Visa Inc. (NYSE:V) as it delivered another solid quarter driven by strong US growth, the ongoing gradual displacement of cash with digital transactions, and accelerated growth in cross-border volume as travel spending plays catch up post-Covid. Visa processed 49.3 billion transactions on its network, up 16% year-on-year and 39% above pre-pandemic levels, driving $2.7 trillion in total payments volume, both of which have more than recovered from the impacts of the pandemic. The total number of cards in Visa’s network also grew by 8% year-on-year to 3.9 billion.
Cross-border transactions were a key issue for Visa during the pandemic, but this headwind has now turned into a tailwind. Constant currency cross-border volumes rose 40% (48% excluding intra-Europe) in the most recent quarter and we expect this trend will continue to play out in the year ahead. While a potential economic slowdown and geopolitical concerns are always a risk, we take comfort in the fact that Visa has a sixty-plus year track record of successfully overcoming numerous macroeconomic challenges that in the moment appeared insurmountable. We believe this current episode will prove no different and that the combination of a very attractive industry structure and the ongoing secular shift towards digital payments provides a foundation that will enable Visa to continue winning for many years to come.”
You can also take a peek at Top 10 REIT Stocks Under $10 and 11 Cheap Healthcare Stocks To Invest In.
