The fintech space is brimming with promising stocks offering innovative new ways to approach finance. Digital banks continue to gain traction, presenting opportunities for sustained growth ahead. According to a recent report, the global fintech industry is poised for rapid expansion throughout the current decade. Its valuation jumped to $257.3 billion in 2022 and is projected to surge to $882.3 billion by 2030, exhibiting a 17% compounded annual growth rate (CAGR).
Nevertheless, with any industry, there are both winners and losers, which makes it imperative to invest in the best fintech stocks to buy, offering a healthy upside ahead. The following three companies should be at the top of your buy list this June.
PayPal (PYPL)
PayPal (NASDAQ:PYPL) is arguably the biggest disruptor in the fintech realm, boasting a leadership position in the niche. To be fair, though, despite its household name, PYPL stock has been far from a rewarding investment. It’s been essentially a value trap over the past few years, with a three-year return of negative 74%.
However, under the fresh leadership of CEO Alex Chriss, PayPal is injecting new energy into its operations, signaling a major turnaround. Recent stock market activity suggests that Chriss’ early efforts have borne fruit, with PYPL stock moving neck-and-neck with the S&P 500 in the past six months.
Furthermore, the company’s financial performance has been nothing short of impressive. It has consistently surpassed analyst expectations in the past three quarters. In its most recent financial report, it recorded a robust 10% increase in sales, driven by a significant 14% rise in total payment volumes.
Chriss’s efforts to rejuvenate the business are still in the early days, but they could redefine PayPal’s trajectory.
Nu Holdings (NU)
Nu Holdings (NYSE:NU) is a Brazilian digital banking trailblazer that has been one of the hottest stocks to buy this year. Its stock is up 42% year-to-date (YTD), fueled by robust top- and bottom-line growth. Moreover, despite the stellar run-up in value this year, Wall Street analysts forecast a 14% increase in Nu stock, which has attracted a ‘strong buy’ rating.
It wrapped up a superb first-quarter (Q1), where its user base shot up to 99.3 million, a 26% increase on a year-over-year (YOY) basis. Additionally, its revenues soared 69% with net income rising a staggering 167%. Also, it now boasts 17 million active investment customers and 82.6 million active users overall, growing rapidly on a YOY basis. No wonder maverick investors like Warren Buffett are taking notice. Berkshire Hathaway (NYSE:BRK-A, BRK-B) now holds 107.1 million shares, a 2.3% stake in the company.
Furthermore, as customers engage more actively across its powerful platform, Nu’s financial ecosystem promises spectacular returns.
Visa (V)
Visa (NYSE:V) is a towering figure in the credit and debit card sector, profiting from its lucrative transaction-based revenue model. By leveraging its cutting-edge technology and scale, Visa can efficiently process millions of transactions with minimal costs, bolstering its profit margins.
To put things in perspective, its gross profit margins are at an eye-popping 98%, which have remained mostly unchanged over the past five years. Similarly, its net income margin is 54%, virtually in line with its five-year averages. Consequently, its cash and short-term investments balance surged a whopping 410% to $20.1 billion last year compared to 2014. Another thing that remains unchanged is its commitment to growing shareholder rewards. It yields 0.75%, increasing dividend payouts for the past 15 consecutive years.
Looking ahead, the firm’s strategic partnerships and its massive proprietary datasets offer a solid foundation for growth. Additionally, its investments in generative artificial intelligence technologies could further boost its operational capabilities and drive fundamental value.
On the date of publication, Muslim Farooque did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines