PYPL

FinTech Stocks Still Attractive, Market Overreacting to Visa’s Cross-Border Travel Outlook

by

Image: Visa continues to rake in the free cash flow. Though its outlook is clouded somewhat by recovering cross-border travel transaction volumes, we still like its asset-light, free-cash-flow rich business model. By Brian Nelson, CFA It’s easy to lose sight of everyday life when we hear stories about the latest and greatest cryptocurrency or the next iteration of yet another ETF that centers on one theme or another, but when we take a step back, almost all of us are still using and continuing to use one of a few payment options. Maybe it’s your Visa (V) Card, your Mastercard (MA), Discover (DFS) Card, American Express (AXP) Card, Capital One Financial (COH) Card or perhaps PayPal (PYPL), Stripe, or Square … Read more

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

by

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

The Investment Case for More Gender Diversity

by

Image: The Impact Shares’ YWCA Women’s Empowerment ETF (WOMN) has trounced the S&P 500 since inception, while the SPDR SSGA Gender Diversity Index ETF (SHE) has bested the quantitatively-hailed small cap value ETF over the same time period. By Valuentum Analysts There has been a plethora of research over the years regarding the value of diversity on teams, in corporate boardrooms, and across asset management. The CFA Institute defines diversity as “the spectrum of human attributes, perspectives, identities, and backgrounds,” and notes that “the discussion around motivations for pursuing diversity in investment management often revolves around two main areas: ‘the business case for diversity’ (i.e., with more diverse perspectives, business outcomes will improve) and ‘because it is the right thing … Read more

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

by

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

Facebook, PayPal, Apple Earnings Reports and More!

by

Image shown: Qualcomm’s chart is looking mighty attractive. By Brian Nelson, CFA We continue to like Facebook (FB), PayPal (PYPL) and Apple (AAPL) as ideas in the Best Ideas Newsletter portfolio following their calendar second-quarter 2021 reports, released recently. Vertex Pharma (VRTX) is our favorite way to play emerging CRISPR technologies through its partnership with CRISPR Therapeutics (CRSP), and we were mighty pleased with Dividend Growth Newsletter portfolio holdings Republic Services (RSG) solid 8% dividend increase and Qualcomm’s (QCOM) impressive momentum. Facebook’s revenue soared 56% in the second quarter, and the company leveraged its operating margin to over 1000 basis points of year-over-year expansion. Both net income and diluted earnings per share more than doubled at the social media giant … Read more

The Valuentum Buying Index as a Differentiating Factor

by

“No other research provider has approached mapping the market in this manner, making Valuentum’s research a differentiating factor behind your practice and a must-have for any investor.” — Brian Nelson, CFA  By Brian Nelson, CFA We have a huge day of earnings coming out today, and we’re excited about the upcoming releases at Apple (AAPL), Alphabet (GOOG) (GOOGL) and Microsoft (MSFT) after the close. Facebook (FB) is scheduled to report after the market close tomorrow, July 28. The important consideration, however, is how these reports impact our long-term forecasts, and we won’t be reading much into their share-price reaction to the reports, whether good or bad. Valuentum stock reports for Apple here (pdf), Facebook here (pdf), Alphabet here (pdf), PayPal … Read more

Chinese Stocks Getting Hammered

by

Image shown: A confluence of factors are driving Chinese stocks lower, not the least of which is heightened regulatory concerns. By Brian Nelson, CFA The collapse in Chinese equities (FXI) (MCHI) during the trading session July 26 is a reminder (again) why you should consider combining momentum with *enterprise valuation* in stocks, as in the Valuentum process. It’s not enough for you to think a stock is undervalued or cheap. The market must agree with you, too. A falling stock price says the market disagrees. Our favorite ideas for consideration are always in the newsletter portfolios, whether the Best Ideas Newsletter portfolio, Dividend Growth Newsletter portfolio, or High Yield Dividend Newsletter portfolio. We do not have any direct exposure to … Read more

Top Ideas Doing Great

by

Image Source: Aguayo Samuel By Brian Nelson, CFA Hi everyone: Hope you’re doing great. The S&P 500 (SPY) continues to roar higher. No longer is the market as easy of a call when we pounded the table near the bottom in April 2020, but we remain bullish on the backdrop. The economy remains very healthy, borrowing rates remain near all-time lows, and widespread interest in equities remains elevated given the paltry yields on alternatives such as investment-grade bonds. We continue to let our winners run, though we remain vigilant in protecting the downside. Quietly, the two top holdings in the Best Ideas Newsletter portfolio, Alphabet (GOOG) and Facebook (FB), have raced to outsized performance during 2021, advancing 43%+ and ~21% … Read more

Best Ideas PayPal and Visa Have Ample Capital Appreciation Upside Potential

by

Image Shown: PayPal Holdings Inc’s digital wallet offers the firm multiple sources of upside. Image Source: PayPal Holdings Inc – February 2021 Investor Day Presentation By Callum Turcan The payment processing and fintech industries are incredibly lucrative and supported by powerful secular growth tailwinds such as the proliferation of e-commerce and the global shift away from cash (towards card, tap to pay, QR code, online, and other payment methods). PayPal Holdings Inc (PYPL) and Visa Inc (V) are two of our favorites in the space, and we include both firms as ideas in the Best Ideas Newsletter portfolio. PayPal’s Long Term Growth Prospects Are Immense PayPal offers an expansive slate of services for consumers and merchants including checkout and point-of-sale … Read more

News Round Up and Some Answers

by

Image Shown: Wendy’s is the latest stock to be swept away by the meme-stock craze, providing further evidence that 1) markets are inefficient and 2) prices and returns are based on future expectations that may be realized or not. By Brian Nelson, CFA Hope you all are doing great. We saw a nice breakout of Facebook’s (FB) share price yesterday, June 7, and we continue to be fans of the social media giant. We view our long-term assumptions as quite reasonable and peg a fair value estimate of $413 per share for this innovative behemoth. There is considerable upside potential as Facebook continues to monetize its massive user base and pursues new initiatives including e-commerce (Shops) and dating (Dating) and … Read more