In this article, we will take a look at the 7 Best Fintech Stocks to Buy as Digital Payment Volume Surges.
In today’s turbulent global economic landscape, having instant access to money, regardless of location or currency, is more crucial than ever. Payment processors hold a significant market share in processing transactions across their networks, providing early insights into consumer purchasing trends.
The growing usage of smartphones and internet apps has fueled the need for increased convenience. ACI Worldwide estimates that real-time transactions account for around 26% of global digital payments, up from 4% in 2016. Much of the development is being driven by emerging economies, notably India and Brazil, where officials supported the deployment of UPI in 2016 and Pix in 2020, respectively.
Despite fears about economic uncertainty stemming from the war in Iran and US-imposed tariffs, spending has remained relatively stable, even as consumer confidence has dipped amid a volatile labor market. This was demonstrated by leading fintech companies such as Visa reporting strong first-quarter results. Speaking on this, Michael Ashley Schulman, Partner of Cerity Partners, said the following:
“If you were hoping for a recessionary tell, the payment processors did not get the memo.”
Across the waters in Europe, things are taking another direction. On June 23, the European Central Bank received legislative support for the introduction of a digital euro. This electronic payment system aims to reduce the eurozone’s reliance on US credit cards during periods of strained transatlantic ties.
Following six years of development, the ECB’s digital currency has gained more attention since President Donald Trump took office, raising fears of weaponized tariffs, even against trade partners.
Our Methodology
We used stock screeners to identify stocks related to financial technology and/or digital payments with a short float of less than 10%. We limited our final selection to companies that have recently reported noteworthy developments likely to impact investor sentiment. The list is ranked in descending order of short float.
Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Insider Monkey’s quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 599.2% since May 2014, beating its benchmark by 372 percentage points (see more details here).
7. Remitly Global Inc. (NASDAQ:RELY)
Short % of Float: 8.90%
Remitly Global Inc. (NASDAQ:RELY) ranks among the best fintech stocks to buy as digital payments volume surges. On June 26, Cantor Fitzgerald restated its Overweight rating and $28 price target for Remitly Global Inc. (NASDAQ:RELY). According to the firm, Remitly’s core remittance operation is creating additional growth opportunities.
Based on Cantor’s assessment, the core operations continue to generate significant revenue growth, free cash flow, and improved GAAP profitability. This gives Remitly Global Inc. (NASDAQ:RELY) additional time and resources to broaden its product offerings and monetize its user base through complementary solutions, such as high-value senders, Send Now/Pay Later, and Remitly Business.
Cantor Fitzgerald stated that these initiatives will be based on Remitly’s current infrastructure, cost base, and client connections instead of marketing to new customers.
Furthermore, on June 4, Citizens maintained its Market Outperform rating and $26 price target for Remitly Global Inc. (NASDAQ:RELY). The firm stated that the loss of an early-stage investor does not impact its opinion of the company, which it sees as a long-term winner in the digital remittance market.
Remitly Global Inc. (NASDAQ:RELY) provides financial services, specifically cross-border remittance services, globally. The company is based in Seattle, Washington, and was founded in October 2018 by Matthew B. Oppenheimer and Joshua Hug.
