Nuvei Stock Is on Fire This Month: Is it a Good Buy Today?

Nuvei (TSX:NVEI) stock may be down 33%, but it jumped 32% in the last month alone. Is it time to pick it up again or wait for more?

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Shares of Nuvei (TSX:NVEI) stock has been climbing back, and investors may have one word on their minds: “Finally.” Nuvei stock is still down by 33% in the last year. However, in the last month alone, the tech stock has been climbing by a whopping 32%! So, is it time to jump back on this stock on the TSX today?

What happened?

Nuvei stock seems to be rallying back with the market to start with. Tech stocks dropped, and Nuvei stock went through some difficult times over the last year or so. This certainly came from point-of-sale companies like Nuvei stock suffering as sales dropped.

Earnings missed again and again, but then that started to change during the most recent third-quarter results. Nuvei stock announced its total volume increased by 72% to $48.2 billion year over year. Further, e-commerce represented 88% of total volume — a major increase. Revenue also rose by 55% to $304.9 million from $197.1 million.

There were still some issues, however. Nuvei stock reported a net loss of $18.1 million compared to a profit of $13 million the year before. This included a net finance cost of $23.6 million, related to reducing revolving credit, plus foreign currency exchange. Even so, adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) increased by 36% to $110.7 million. So, what’s coming next?

Shares rise, but for how long?

Shares have certainly made huge moves at 32% in the last month alone after earnings. However, how long can it last? Some might say, it won’t come to an end as we enter a bear market, which companies such as Barclay’s believe will be coming in the new year.

What investors will certainly need to keep their eye on then is Black Friday to Cyber Monday sales. Nuvei stock will certainly see major improvements, so, therefore, there should be some improvements for the fourth quarter as well. So, coming off some positivity, the company could certainly end on a high.

In fact, the company also raised its outlook in the third quarter. Nuvei stock now expects total volume to reach between $57 and $59 million in the last quarter, with the full-year rising to between $198 and $200 million from $193 and $197 million. Growth targets were also strong, with revenue increasing 15-20% annually year over year in the medium term, with adjusted EBITDA at 50% or higher in the long term.

What now?

Shares of Nuvei stock, as mentioned, are still down by 33% in the last year. The company surged in share price when e-commerce was doing well, but investors may still be a bit jumpy. It looks as though there was an e-commerce bubble that burst, with shares climbing but perhaps not hitting those all-time highs.

Even so, companies like Nuvei stock are a necessity in the future of ecommerce. Its payment technology may not see shares surge in the near term back to all-time highs, but there is certainly enough here to believe that should occur eventually — especially as the company outlines long-term adjusted EBITDA growth.

So, if you’re a patient investor, as we continue this turnaround, there is definitely a reason to consider buying Nuvei stock today. However, if you’re risk averse, perhaps stay on the sidelines for now. After all, we’re not in a bull market yet.

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 Amy Legate-Wolfe has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Nuvei. The Motley Fool has a disclosure policy.

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