The Global X Fintech ETF is almost flat year-to-date, but Gradient Investments’ Jeremy Bryan is convinced the story will be different in 2022.
What fintech names does he like in particular?
Two legacy fintech names in particular that pop out to him are Visa Inc (NYSE: V) and Mastercard Inc (NYSE: MA), both of which are in the red this year. Making his bullish case for the two stocks on CNBC’s “Power Lunch”, Bryan said:
Visa and Mastercard are the transaction railroad. Their business will probably grow even faster than the overall economy. We’re talking about multiple that have severely come down since summer. So, now is the time to get interested in these, and I think 2022 is setting up very well for these stocks.
Other reasons he likes Visa and Mastercard include his forecast of a 15% plus earnings growth for both. A day earlier, Mastercard acquired Arcus to extend its real-time payment applications across Latin America.
Bryan doesn’t see BNPL as a threat for legacy players
He agreed that the rise of the BNPL services and the crypto industry does add competition to the overall fintech space but said it was unlikely for the legacy players to be threatened in the near future.
There’s certainly more attention around the competitive landscape, but BNPL is still a very minuscule portion of the overall transaction volume out there. And then on the crypto side, it’s used more as a trading mechanism rather than the transaction mechanism.
Bryan, therefore, is convinced the fintech sector has bottomed and sees the recent dip as a great buying opportunity. Late last month, both Visa and Master reported strong results for their recent fiscal quarters.
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