The global shift toward cashless transactions has a tremendous impact on the fintech business. As customers prefer digital payment options, fintech companies are coming in to provide secure and efficient payment solutions, hence fueling industry growth.
Thus, investors could consider adding fundamentally sound fintech stocks, Visa Inc. (V), PayPal Holdings, Inc. (PYPL), and Jiayin Group Inc. (JFIN), reshaping digital payments.
The growing need for digital financial services is a key driver of the fintech market. According to the World Bank, over 1.7 billion adults globally are still unbanked, emphasizing the need for accessible financial services. The fintech market is projected to grow at a CAGR of 14% by 2031.
The digital payment market consists of platforms and technologies that enable electronic transactions. This market is expanding rapidly due to the rise of e-commerce, mobile payments, and fintech solutions. Due to convenience and the growing trust in secure, cashless systems, businesses and consumers are shifting to digital payment methods.
Considering these factors, let’s take a look at the fundamentals of the three fintech stock picks.
Visa Inc. (V)
V is a payment technology company in the United States and internationally. The company operates VisaNet, a transaction processing network that enables authorization, clearing, and settlement of payment transactions.
On January 23, 2025, V made strategic investments in Moniepoint Inc., one of Nigeria’s leading business payments and banking services platforms. The investment marks an important milestone in Visa’s commitment to advancing financial inclusion and shaping the future of digital payments while fostering SME growth across Africa.
V’s 97.82% trailing-12-month gross profit margin is 67.1% higher than the 58.53% industry average. Furthermore, the stock’s 54.27% trailing-12-month net income margin is 142.1% higher than the 22.41% industry average.
During the fiscal 2025 first quarter that ended on December 31, 2024, V’s net revenue increased 10.1% year-over-year to $9.51 billion. Its non-GAAP net income and non-GAAP EPS were $5.46 billion and $2.75, up 10.6% and 14.1% year-over-year, respectively.
Analysts expect V’s revenue to increase 8.8% year-over-year to $9.55 billion, accompanied by a projected 6.8% year-over-year rise in EPS to $2.68 for the fiscal quarter ending March 2025. Moreover, the company has surpassed consensus EPS estimates in each of the trailing four quarters, which is impressive.
The stock has gained 19.3% over the past three months to close the last trading session at $345.15.
V’s POWR Ratings reflect its positive outlook. The stock has an overall rating of B, which translates to a Buy in our proprietary rating system. The POWR Ratings are calculated by considering 118 different factors, with each factor weighted to an optimal degree.
The stock has a B grade for Sentiment, Momentum, Stability, and Quality. V is ranked #7 out of 48 stocks in the Consumer Financial Services industry.
Click here to access the additional V ratings (Value and Growth).
PayPal Holdings, Inc. (PYPL)
PYPL operates a technology platform that enables digital payments on behalf of merchants and consumers worldwide. It operates a two-sided network at scale that connects merchants and consumers and enables its customers to connect, transact, and send and receive payments online and in person and transfer and withdraw funds using various funding sources.
PYPL’s trailing-12-month ROCE of 20% is 94.9% higher than the industry average of 10.26%. Also, the stock’s trailing-12-month ROTC of 11.40% is 70.8% higher compared to the industry average of 6.67%.
For the fourth quarter that ended December 31, 2024, PYPL’s net revenues increased 4.2% year-over-year to $8.37 billion. Its non-GAAP net income came in at $1.21 billion, while its non-GAAP EPS increased by 4.4% year-over-year to $1.19. Its non-GAAP operating income went up by 2.3% from the prior year’s quarter to $1.50 billion.
Analysts expect PYPL’s revenue for the first quarter ending March 2025 to increase 2% year-over-year to $7.85 billion. Street expects its EPS to be $1.16 for the same quarter, up 7.5% year-over-year. Moreover, the company surpassed consensus revenue and EPS estimates in three of the trailing four quarters, which is promising.
PYPL’s stock has soared 20.3% over the past nine months to close the last trading session at $77.72.
PYPL’s robust fundamentals are reflected in its POWR Ratings. The stock has an overall rating of B, which translates to a Buy in our proprietary rating system.
PYPL has a B grade for Momentum and Sentiment. It is ranked #14 out of 48 stocks in the Consumer Financial Services industry.
Beyond what is stated above, we’ve also rated PYPL for Growth, Value, Stability, and Quality. Get all PYPL ratings here.
Jiayin Group Inc. (JFIN)
JFIN provides online consumer finance services in the People's Republic of China. The company operates a fintech platform that facilitates connections between individual borrowers and financial institutions.
JFIN’s 46.91% trailing-12-month ROCE is 357.2% higher than the 10.26% industry average. Furthermore, the stock’s 27.17% trailing-12-month ROTC is 307.1% higher than the 6.67% industry average.
For the fiscal 2024 third quarter that ended on September 30, JFIN’s net revenue increased 1.5% year-over-year to RMB1.47 billion ($202.71 million). The company’s net income increased 20.1% year-over-year to RMB323.90 million ($44.67 million), whereas its net income per share grew 18.9% from the prior year’s quarter to RMB1.51.
Shares of JFIN have surged 55.3% over the past six months and 54.1% over the past year to close the last trading session at $8.15.
JFIN’s POWR Ratings reflect strong prospects. The stock has an overall rating of A, equating to a Strong Buy in our proprietary rating system.
The stock has an A grade for Value and a B for Momentum, Sentiment, and Quality. JFIN is ranked #2 out of 83 stocks in the Financial Services (Enterprise) industry.
In addition to the POWR Ratings highlighted above, one can access JFIN’s ratings (Stability and Stability) here.
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V shares were trading at $347.25 per share on Wednesday afternoon, up $2.10 (+0.61%). Year-to-date, V has gained 9.88%, versus a 2.88% rise in the benchmark S&P 500 index during the same period.
About the Author: Nidhi Agarwal
Nidhi is passionate about the capital market and wealth management, which led her to pursue a career as an investment analyst. She holds a bachelor's degree in finance and marketing and is pursuing the CFA program. Her fundamental approach to analyzing stocks helps investors identify the best investment opportunities.
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