3 Fintech Stocks Making Headlines In The Stock Market Today
Fintech stocks are growing in popularity in the stock market today. But before we dive in, what exactly is fintech? It is a term used to describe new tech that seeks to improve and automate the delivery and use of financial services. Essentially, it is used to aid companies and consumers in managing their financial operations, processes, and lives by utilizing specialized software and algorithms. Basically, a combination of words between “financial” and “technology”.
With cashless payments being the safest means of buying just about anything now, fintech companies have been seeing huge gains in the stock market. We only need to look at the likes of Square (NYSE: SQ) and PayPal (NASDAQ: PYPL). The two have seen gains of over 150% and 70% respectively in their stock price over the past year. Being able to make payments digitally provides a new dimension of convenience to consumers. But we all know there’s more to fintech than just making payments digitally. Another megatrend to watch that falls under the segment is the rise of digital brokerage and wealth management platforms.
Can’t Wait For Robinhood’s IPO? These 3 Fintech Stocks Are In Focus
Robinhood, the popular trading app, is on track for a multi-billion dollar IPO in the coming months. It’s no doubt one of the fastest-growing fintech startups and has risen to become one of Silicon Valley’s most valuable private unicorns. Despite its recent challenges, I guess it’s safe to say that many investors will be scrambling for a piece of the company when it goes public.
Given that the pandemic saw many new retail investors looking to profit from the market, the growth in the online brokerage industry appears to be extremely robust. With a sea of new retail investors coming into the market, there’s no question that these fintech providers will be among the biggest beneficiaries. Seeing the momentum like this, you may be looking for the best fintech stocks to buy now. If that’s the case, here are 3 top fintech stocks making waves in the stock market lately.
Top Fintech Stocks To Buy Right Now
- UP Fintech Holding (NASDAQ: TIGR)
- Futu Holdings (NASDAQ: FUTU)
- Social Capital Hedosophia Holdings Corp V (NYSE: IPOE)
UP Fintech, more commonly known as “Tiger Brokers”, is a leading online brokerage firm that caters to customers on a global scale. Its proprietary mobile and online trading platform enable investors to trade in equities and other financial instruments on multiple exchanges. The company’s stock price made a huge jump on Tuesday’s trading after reporting financial results for the first quarter of 2021. Investors were certainly delighted with the company’s first-quarter performance.
In the first-quarter report, revenue came in 256% higher year-over-year to $81.3 million. Like many other online brokerages, the surge in its trading volumes contributed to the strong revenue growth. It’s also worth mentioning that the company added 117,000 funded accounts during this quarter. This, coupled with the growth in customer deposits, should bode well for the company over the long term. Besides, the company has also expanded its operations to Singapore and Australia a few months ago. With the impressive financials and thriving market activities, it is not surprising why investors are bidding up TIGR stock.
“We are pleased to announce that our Company delivered strong growth in revenue, profits, and client assets in the first quarter of 2021. Total revenues were US$81.3 million, a 255.5% increase from the first quarter of 2020, and were bolstered by solid increases in commissions, interest income, and revenues derived from our corporate business.”- Wu Tianhua, CEO & Director of UP Fintech.
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Futu Holdings is a leading tech-driven online brokerage and wealth management platform in China. Impressively, the company has strong backing from notable shareholders like Tencent (OTCMKTS: TCEHY), Matrix Holdings, and Sequoia Capital. With the backing of a company like Tencent, coupled with the trending tailwinds, the potential for Futu to cement itself as a leader in China’s mobile and online brokerage is bright indeed. With strong expectations of the company’s business performance, FUTU stock has risen by nearly 200% year-to-date.
From the company’s first-quarter report, revenue came in 349% higher year-over-year to $283.6 million. Its total gross profit was even more impressive, as it came in 372.6% higher year-over-year to $226.6. That handily beat the estimates from Wall Street. However, despite the impressive earnings beat, FUTU stock has been trading sideways in recent months. That’s amid pressure on top growth stocks in the market.
While that might cause some investors to shy away from growth stocks like Futu, some are scooping up the stock on the dip. FUTU stock could be your best bet on tapping on the rapid growth of China’s retail investing industry. After all, the rise of retail investors is pretty much a global phenomenon. Considering Futu’s robust financials and the growth of the markets it operates in, we could be looking at a long growth runway indeed. Could FUTU stock be a multibagger in the making?
Unlike Tiger Brokers or Futu, Social Capital Hedosophia Holdings V is a special purpose acquisition company (SPAC). While IPOE stock shares pretty much the same fate as many other SPACs, this doesn’t make it an outright bad investment. For those unfamiliar, the SPAC plans to take SoFi public. SoFi stands out as one of the most innovative fintech players around. While SPACs may not have a fantastic rep, there is certainly potential with SoFi.
Not sure if you notice, but IPOE stock has climbed nearly 40% for the past two weeks. This could be in anticipation of the shareholder vote on May 27. If IPOE shareholders approve the merger with SoFi on May 27, SoFi could start trading on the Nasdaq on June 1. But a big part of its rally may actually have to do with SoFi’s first-quarter earnings. In its first quarter, total revenue came in 150% higher year-over-year to $216 million. The company also added 430,000 new members in the quarter, bringing total membership to 2.28 million. That represents an increase of 110% from a year ago.
Of course, SoFi may have yet to be a profitable company today, but that may change soon. Apart from online brokerage, the company also offers a wide array of financial products including home mortgages, loans, and credit cards. Recently, SoFi also announced that it plans to offer auto loan refinancing options for its members because of customer demand. If anything, it is increasingly looking like a one-stop-shop for financial products for its customers. If you believe that SoFi will deliver great long-term returns, would buying IPOE stock ahead of its merger be a great idea?