Financial service is one of the largest sectors not just in Canada, but across the world. The growth of technology has pushed companies to offer a range of financial services just a few screen taps away.
The fintech industry is poised for further and hence, investors are likely to see healthy returns. Let us now look at some stocks that may reap benefits for fintech enthusiasts:
Mogo Inc. (TSX:MOGO) (NASDAQ:MOGO, MOGO.US)
The Vancouver-based company offers personal finance and money management services through its applications. With about one million users in Canada, the application offers products including personal loans, credit score monitoring, mortgage, among others. Mogo is listed on both the Toronto Stock Exchange and the NASDAQ.
The fintech player’s market cap is hovering around C$ 640 million, with about 70.3 million outstanding shares. It recorded a multifold growth in the last one year, rising from C$ 1.33 on June 23, 2020, to close at C$8.88 on Thursday, June 17, 2021.
Its quarterly revenue fell on a year-over-year (YoY) basis in the first quarter ended March 31, 2021. It earned C$ 11.4 million as against C$ 13.9 million in the first quarter of 2020. Its sequential performance, however, improved slightly, as the company earned C$10 million in revenues in the fourth quarter of 2020.
With the growing interest in the cryptocurrency space, Mogo plans to increase its investment in the blockchain ecosystem.
Nuvei Corporation (TSX:NVEI)
The technology company offers electronic payment gateway to its users via mobile and in-store channels. Nuvei earns a major share of its revenues from the US market operations, while European Union, UK, and some other countries also are its operational markets.
The company’s current market capitalization is around C$12.04 billion with over 138 million outstanding shares. It listed on the TSX in September 2020 and raised gross proceeds of about US$ 700 million.
In the first quarter ended March 31, 2021, the company recorded an 80 per cent volume growth on a YoY basis. It also expanded its operations in several countries in Latin America.
The company is also set to be included in the S&P/TSX Composite Index, Canada’s benchmark stock index, from Monday, June 21.
Constituents of the Canadian benchmark are largely market leaders and their performance generally taken as a proxy for the sector’s performance.
Shopify Inc. (TSX:SHOP) (NYSE:SHOP)
One of the biggest e-commerce platforms in Canada, Shopify also offers fintech services to its clients as a measure to ramp up digital operations for their customers.
Customers may use their Shopify balance to make transactions, and even get access to the installment payment option offered by the company.
The Ontario-based company is listed on both the New York Stock Exchange and TSX. The stock price hit C$ 1790.01 on June 17, 2021, up over 5600 per cent from its debut price of C$ 31.25 in 2015.
The e-commerce giant now has a C$222.6 billion market capitalization, with a 100.90 price-to-earnings (P/E) ratio. The stock’s debt-to-equity (D/E) ratio of 0.12. Its return on equity is about 26.42 percent, as per TMX data.
The company expects solid growth in its operations seeing the opportunities in the digital commerce space, going forward.
It recorded a 110 percent YoY jump in its total revenues, which touched US$ 988.6 million in the first quarter ended March 31, 2021. It also saw a 71 percent jump in its subscription solutions segment revenues as new subscribers (merchants) joined the platform during the quarter. Revenues from the segment were about US$ 320 million.
Lightspeed POS Inc. (TSX:LSPD)
One of the top technology stocks on the TSX, Lightspeed POS primary offering is its omni-channel point of sales Software as a Service (SaaS) platform for commercial transactions. The platform allows clients to engage with their customers, make payments seamless. It uses a direct sales force for its markets in the US, Canada, Netherlands, and Australia.
Lightspeed POS is a nearly C$ 12.6 billion company, with over 131 million outstanding shares. The stock has a 5.33 price-to-book ratio, and a 0.03 D/E ratio.
Its ecommerce, delivery and payments platforms saw a sharp demand pickup in March as the COVID-19 pandemic pushed businesses to adopt sophisticated software channels for their operations.
It is also an actively traded stock on the TSX, with an average daily trading volume of 1.05 million shares in the last 30 days.
While the company expects some disruption to its operations due to the pandemic in the near term. However, Lightspeed sees itself well positioned for its investments going forward through its over US$ 210 million cash reserves.
Please note: The above constitutes a preliminary view and any interest in stocks should be evaluated further from an investment point of view. The reference data in this article has been partly sourced from Refinitiv.