IPAY

Best Idea Visa on the Rebound, Generating Gobs of Free Cash Flow

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Image Shown: Visa Inc is a stellar free cash flow generator and is included as an idea in our Best Ideas Newsletter portfolio. Image Source: Visa Inc – Third Quarter of Fiscal 2021 IR Earnings Presentation By Callum Turcan We’re huge fans of the payment processing and payment solutions space. This industry is supported by secular growth tailwinds due to the global shift away from cash-to-card and card-not-present (e.g. online purchases) purchase options, and the ongoing proliferation of e-commerce. Furthermore, companies in this space benefit immensely from the network effect, which creates an economic moat for their business.  These companies are incredibly lucrative with relatively high operating margins and impressive free-cash-flow generating abilities, aided by their relatively modest capital expenditure … Read more

Best Idea PayPal Is a Tremendous Enterprise with Ample Capital Appreciation Upside

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Image Source: PayPal Holdings Inc – 2021 Investor Day Presentation By Callum Turcan PayPal Holdings Inc (PYPL) is a stellar enterprise, and we view the fintech company’s capital appreciation upside quite favorably, which is why we include shares of PYPL as an idea in the Best Ideas Newsletter portfolio with a significant ‘weighting.’ Shares of PYPL have been on a steady upward climb of late, and investors continue to warm up to the name. Expansive Offerings Creates Sizable Synergies PayPal put up stellar performance during the first half of 2021. Its number of active accounts rose to 403 million at the end of June 2021 from 377 million at the end of December 2020, while its payment transactions per active … Read more

We’re Reiterating Our $200 Fair Value Estimate for PayPal

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We continue to be big fans of PayPal. The company has a pristine balance sheet, high quality cash flow profile, impressive growth outlook, and is trading well below its fair value estimate as of this writing. Though investors initially sold off shares of PYPL following its third-quarter report November 2 due to its expected growth trajectory slowing down in the near term, we’re reiterating our fair value estimate of $200 per share as PayPal continues to deliver impressive fundamental performance. PayPal’s medium- and long-term growth outlooks remain stellar. Venmo could be a source of significant upside in the medium-term, and we are monitoring events closely. By Callum Turcan On November 2, PayPal Holdings Inc (PYPL) reported third quarter 2020 earnings … Read more

Apple’s Growing Financial Tech Business

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Image Shown: Shares of Apple Inc, a holding in both our Best Ideas Newsletter and Dividend Growth Newsletter portfolios, have surged higher year-to-date. We see room for additional capital appreciation upside. By Callum Turcan We continue to be huge fans of Apple Inc (AAPL), and shares of the tech giant are included as a holding in both our Best Ideas Newsletter and Dividend Growth Newsletter portfolios. Our fair value estimate for Apple sits at $140 per share, comfortably above where shares of AAPL are trading at as of this writing, indicating there is room for meaningful capital appreciation upside. Additionally, shares of AAPL yield a modest ~0.7% as of this writing, and we view its forward-looking dividend growth trajectory quite … Read more

Alibaba Mirrors the Performance of Its Western Peers

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Image Shown: Alibaba Group Holding Limited posted strong results for the fiscal quarter ended June 30, 2020, mirroring the performance of its large-cap tech peers based in Western countries (particularly the US). Image Source: Alibaba Group Holding Limited – June Quarter 2020 Earnings Presentation By Callum Turcan At a time when US-China geopolitical tensions are rising and the Trump Administration is pushing the Chinese tech firm ByteDance to divest (at least) the US-based operations of TikTok, many Chinese tech firms are still thriving. The ongoing coronavirus (‘COVID-19’) pandemic has fundamentally altered daily life for most households around the world. Social distancing practices have aggressively driven up e-commerce demand along with demand for cloud computing offerings (as more employees work from … Read more

Visa Remains Resilient in the Face of COVID-19

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Image Shown: Visa Inc remained a free cash flow cow last fiscal quarter in the face of the pandemic. Image Source: Visa Inc – Third Quarter of Fiscal 2020 IR Earnings Presentation By Callum Turcan On July 29, Visa Inc (V) reported third quarter fiscal 2020 earnings (period ended June 30, 2020) that missed consensus top-line estimates and beat consensus bottom-line estimates. The ongoing coronavirus (‘COVID-19’) pandemic weighed on travel-related purchases across Visa’s cardholder base, a dynamic that held down cross-border transactions which tend to be more lucrative for the payment processor. Keeping pandemic-related headwinds in mind, the company noted its performance was improving in several key markets around the world. We continue to like Visa as a top-weighted holding … Read more

PayPal Posts a Tremendous Quarterly Report, Reinstates Guidance

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Image Shown: PayPal Holdings Inc put up tremendous performance during the first half of 2020 as consumers are increasingly shopping online. In the second quarter of 2020, PayPal continued to grow at a decent clip even in the face of the ongoing pandemic. Image Source: PayPal Holdings Inc – Second Quarter of 2020 IR Earnings Presentation By Callum Turcan After the market close July 29, PayPal Holdings Inc (PYPL) reported second quarter 2020 earnings that beat consensus top- and bottom-line estimates. Shares of PYPL moved sharply higher after the report was published, and we continue to like PayPal as a holding in the Best Ideas Newsletter portfolio. Our fair value estimate sits at $200 per share of PYPL, comfortably above … Read more

Data from Visa Indicates the Economic Outlook is Improving

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Image Shown: Visa Inc reports that US processed transactions volumes across its payment processing network improved materially on a year-over-year basis in May, relatively speaking, versus the downturn seen in the second half of March and the first half of April. Image Source: Visa Inc – 8-K SEC Filing By Callum Turcan One of our favorite secular growth industry tailwinds is happening in the payment processing, payment solutions, and financial technology space. The world is shifting toward a “cashless” society, and that has accelerated due to the ongoing coronavirus (‘COVID-19’) pandemic, in part due to the rise of e-commerce and in part due to the preference of many consumers to use contactless payment options when in physical stores. Visa Inc … Read more

Best Idea PayPal Soars on Very Promising Outlook

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Image Shown: Best Ideas Newsletter portfolio idea PayPal is surging after a strong outlook that speaks to underlying strength of the “new” consumer in a post COVID-19 world. By Callum Turcan On May 6, one of our favorite companies PayPal Holdings Inc (PYPL) reported first quarter 2020 earnings. While PayPal missed consensus estimates on both the top- and bottom-line, investors looked towards the future and shares of PYPL rose sharply after the report on May 7. We continue to like PayPal as a near top-weighted holding in our Best Ideas Newsletter portfolio. Please note we increased the weighting of PYPL shares in that newsletter portfolio back on January 13, 2020 (link here) and further increased PayPal’s weighting in our Best … Read more

Visa Reports That Global Spending Levels May Have Started to Stabilize in April

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Image Source: DeclanTM By Callum Turcan One of our favorite companies and a top-weighted holding in our Best Ideas Newsletter portfolio, Visa Inc (V), reported second-quarter earnings for fiscal 2020 (period ended March 31, 2020) which beat both consensus top- and bottom-line estimates. Going forward, while Visa’s very lucrative travel-related businesses (which includes payment processing and foreign currency transaction solutions) will take a hit from reduced travel worldwide due to the ongoing coronavirus (‘COVID-19’) pandemic, management is focused on controlling expenses to offset exogenous headwinds. Specifically, management noted that Visa would pull back on “discretionary spending especially related to personnel, travel, professional services, and marketing” which we appreciate. Outlook Commentary In the fiscal second quarter, Visa reported a 7% increase … Read more