Tech startups come and go, but companies that combine finance and technology could have more staying power to entice investors. The fintech arena is slowly filling up with some firms exhibiting long-term potential. PayPal, Square, and Mercado Libre are the leading names in America’s fintech universe.
Canadian investors, particularly millennials, can find fintech stocks to their liking on the TSX. Nuvei (TSX:NVEI) and Mogo (TSX:MOGO)(NASDAQ:MOGO) are worthy of consideration. The fintech market should be attractive given the incredible growth potentials in the 21st century. You don’t have to time the market to invest in Nuvei and Mogo because of the innovative products and services.
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Superior returns in the near term awaits Nuvei investors. The $18.61 billion enterprise is making the world a local marketplace, according to its website. Management’s goal is to provide a single point of integration for all payment needs. Nuvei wants to eliminate payment barriers globally.
Nuvei offers flexible and innovative payment innovations to enhance customer experiences. Its platform attracts thriving brands, because of high-speed processing and maximum uptime. Moreover, the platform can accommodate a large volume of transactions.
The Montreal-based company is building scale. In the first half of 2021 (six months ended June 30, 2021), total volume and revenue grew 139% and 97% versus the same period in 2020. From a US$48.4 million net loss, Nuvei posted US$38.9 million in net income.
Gain-wise, the tech stock has rewarded investors with a 196.98% total return in less than a year. The current share price of $133.79 is 190% higher than on September 18, 2020. Had you invested $10,000 then, you’d be $18,990.25 richer today. Market analysts predict the price to climb more than $145 in the next 12 months.
Mogo is on the watchlist of Investopedia, which says that the Vancouver-based fintech is the Uber of finance. Its CEO David Marshall Feller had young Canadians when he founded Mogo. The $472.92 million online lending platform aims to elevate millennials’ financial literacy and improve their financial health.
The financial results in the first half of 2021 reflect a flourishing business. Mogo reported a $6.2 million net income compared to the $11.6 million net loss in the same period last year. Revenue growth was only 3%, although it was 29% in Q2 2021 versus Q2 2020. Notably, subscription and services revenue increased 81%.
Mogo investors enjoy a 38.84% gain thus far in 2021. At $6.72 per share, the trailing one-year price return is 214.02%. The price has gone to as high as $14.35 on March 19, 2021. Still, had you invested $5,000 a year ago, your capital would be more than double ($10,700.93) today.
The company offers simple digital solutions through the Mogo app. Customers have a spending account and access to personal loans. You can also avail yourself of free credit score monitoring and ID fraud protection. Crypto fans can trade bitcoin too. Mogo expects to end 2021 with 100% to 110% year-over-year growth in subscription and services revenue.
There’s no stopping Nuvei and Mogo from trailblazing in the fintech space. Millennials could derive massive returns by taking positions while the share prices are relatively low. You have a pair of future tech superstars that could outshine and outperform Shopify, Canada’s tech giant.
This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium service or advisor. We’re Motley! Questioning an investing thesis — even one of our own — helps us all think critically about investing and make decisions that help us become smarter, happier, and richer, so we sometimes publish articles that may not be in line with recommendations, rankings or other content.
Fool contributor Christopher Liew has no position in any of the stocks mentioned. The Motley Fool owns shares of and recommends MercadoLibre, PayPal Holdings, Shopify, and Square. The Motley Fool recommends Uber Technologies and recommends the following options: long January 2022 $75 calls on PayPal Holdings, long January 2023 $1,140 calls on Shopify, and short January 2023 $1,160 calls on Shopify.