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Summary
- The pandemic has thrust fintech and paytech companies into the spotlight as consumers shift from cash to virtual payment systems.
- Nuvei’s stock has surged 17 per cent since its stock market debut in September this year.
- Lightspeed POS’ stock has swelled by an astonishing 219 per cent since the pandemic-caused market crash.
- Fintech firm GoldMoney has climbed nearly 32 per cent year-to-date (YTD).
Financial technology (fintech) industry was already on a growth trajectory before the coronavirus hit the Canadian economy. Consumers transitioned from cash to virtual payment as the pandemic revolutionized the way our world operates. In the wake of these developments, fintech and paytech companies took centerstage.
As per a National Crowdfunding & Fintech Association of Canada (NCFA Canada) study, over 96 percent of businesses surveyed said that fintech is a strategic priority for financial institutions as pandemic has minimized human interaction.
In the backdrop of these events, we look at three fintech stocks -- Nuvei Corp (TSX:NVEI), Lightspeed POS Inc (TSX: LSPD & NSYE: LSPD) and GoldMoney Inc (TSX:XAU).
Nuvei Corporation (TSX:NVEI)
Sector: Technology
Industry: Software
Current Stock Price: C$ 52.76
Newly listed Nuvei Corp has been trending on the Toronto Stock Exchange (TSX) since its initial public offering (IPO) on September 17, 2020. This fintech stock has surged 17 per cent in about a month.
Montreal-based Nuvei provides payment technology solutions to merchants and partners in North America, Europe, Asia Pacific, and Latin America. This fintech company offers mobile, online and in-store payments. The company generates its revenue through subscriptions, sales, and transaction fees.
Nuvei Corp listed the biggest tech IPO on the TSX last month, raising US$ 833 million. Nuvei’s current market cap is C$ 2.07 billion.
The company has also started providing payment services to gaming operators and sports betting companies to target customers aged over 21. With Canada legalizing sports betting, payment companies are in a race to acquire more gaming payment platforms.
Lightspeed POS Inc. (TSX:LSPD & NYSE:LSPD)
Sector: Technology
Industry: Software
Current Stock Price: C$ 47.34
Lightspeed POS’ omnichannel commerce software as a service (SaaS) platform helps customers and clients handle operations, accept payments, and grow their businesses. The company has operations in North America, Europe, and Australia, and several other countries across the globe.
Lightspeed ranks among TMX Money’s top price performing stocks on the TSX and the TSX Venture (TSXV) that have posted the largest gains in the last 30 days. The company has also been placed on TMX stocklist of top tech companies that are outperforming their peers on the TSX and the TSXV.
Lightspeed’s current market cap stands at C$ 4.26 billion. The tech company’s stock has gained nearly 31 per cent year-to-date (YTD). Since the pandemic-caused market crash, this stock has swelled by an astonishing 219 per cent.
The tech company recently raised US$ 397.7 million from its US stock market debut on the New York Stock Exchange (NYSE). The stock was priced at US$ 30.50 apiece.
One-year price chart of Lightspeed POS (Source: EODHD/Others, Thomson Reuters)
Lightspeed’s Financials
Lightspeed’s total revenue for the first quarter fiscal 2021 (ended on 30 June 2020) was C$ 36.2 million, an increase of 51 per cent year-over-year. The company posted a net loss of C$ 20.1 million for Q1 of FY 2021, as compared to net loss of C$ 9.1 million in Q1 of FY 2020. The company generated recurring software and payments revenue of C$ 33.4 million -- a growth of 57 per cent year-over-year. At the end of the latest quarter, Lightspeed had C$203.5 million unrestricted cash and cash equivalents in hand.
GoldMoney Inc. (TSX:XUA)
Sector: Financial Services
Industry: Capital Markets
Current Stock Price: C$ 2.47
Toronto-based GoldMoney is a fintech firm operating a gold-based financial services platform. The company offers personal, business, and wealth account. It has three segments -- Goldmoney.com and SchiffGold and Lends and Borrow Trust. Goldmoney.com brings in most of the revenue.
GoldMoney’s current market capitalization stands at C$ 192.76 million. The stock has surged nearly 32 per cent year-to-date (YTD). The company issued a dividend of C$ 0.004 in first quarter fiscal year 2020-21. GoldMoney’s dividend yield is 0.616 per cent and the price-to-book ratio is 1.042, according to TMX data.
GoldMoney’s total IFRS revenue for the first quarter ended on 30 June 2020 was C$ 173.5 million -- a staggering rise of 193 per cent YoY. The company reported gross profit of C$ 10.6 million for Q1 2021, up 159 per cent from C$ 4.1 million in Q1 2020.
Goldmoney.com Group’s client assets surged 10 per cent quarter-on-quarter to C$ 2.29 billion in Q1 2021. Its client asset value stood at nearly C$ 2.8 billion. The company’s corporate yellow metal position is nearly C$ 45 million.
