14. October 2021 | 08:20 CET
Square, BIGG Digital Assets, Advanced Micro Devices - Profiteers of the FinTech and crypto boom
FinTech and crypto are defining investment themes of today. Even though there are now efforts by politicians to curb or regulate cryptocurrencies, they will remain part of our everyday lives in the long run. For cryptos to be usable by the broad population, it is essential to make them easy and safe to trade and use as a means of payment. That requires certified trading platforms and reliable payment service providers. These are not the only ones who will benefit from the development; hardware manufacturers are also in great demand.
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ISIN: SQUARE INC. A | US8522341036 , BIGG DIGITAL ASSETS INC. | CA0898041086 , ADVANCED MIC.DEV. DL-_01 | US0079031078
Square Inc. - Analysts: Great share price potential through the acquisition of AfterPay
The financial services and payment provider Square Inc. from San Francisco, California, has lost some ground since its six-month high in August. According to industry experts, the USD 29 billion price tag for the acquisition of buy-now pay-later service provider AfterPay was too high and had weighed on its financials. In the meantime, however, analysts have concluded that the potential that will arise from the combination justifies the high purchase price. Square will convert existing AfterPay users into users of its CashApp in the long term and is thus expected to double its user numbers from the current 40 million active users per month by 2025. Experts also see the CashApp as the primary growth driver in the coming years.
Analysts at Jeffries expect CashApp to contribute about two-thirds of gross profit growth over the next five years. A further boost to customer reach is expected from the recently announced partnership with the popular video app TikTok. It will give TikTok's more than 1 billion users straightforward access to directly linked products through Square's online store. The consensus view among analysts is that a price target of around USD 300 is now realistic. That corresponds to a potential of approximately 25% at the current price.
BIGG Digital Assets - Certification of the trading platform
Cryptocurrencies are considered a thorn in the side of many governments. They are challenging to regulate, and transaction routes are difficult or even impossible to trace. As a result, cryptocurrencies offer ideal conditions for financing illegal activities and lead to billions of euros in lost taxes for states. But also for users, cryptocurrencies and the associated trading venues are currently mostly insecure, as they are often not regulated and thus secured like traditional banks. And this is where the Canadian IT Company BIGG Digital Assets comes in.
On the one hand, BIGG operates a crypto exchange with its wholly-owned subsidiary Netcoins, which has recently been certified by the Canadian regulatory authorities as a regulated trading center. On the other hand, the Canadians develop solutions for transaction security and tracking of payment flows, which are in demand, for example, by classic banks or the public sector. As the provider of a certified trading venue, BIGG will have the opportunity in the future to massively expand promotional activities for its platform. In contrast, non-licensed competitors are increasingly operating in a legal gray area and must fear being forced out of the market sooner or later. The crypto security and payment flow traceability business bundled in the Blockchain Intelligence Group should also be good for share price gains.
One of BIGG's competitors was recently acquired by US-based Mastercard. Although it was agreed not to disclose the purchase price, experts assume a three-digit million amount. BIGG, on the other hand, after a price rally to CAD 3.00 in the course of the general crypto hype, has currently returned to a price level of around CAD 1.30, which corresponds to a market capitalization of just CAD 250 million. It should be noted that the Company is currently sitting on around CAD 60 million in cash and other assets held in various cryptocurrencies. This constellation is the reason for analysts to invest in the stock now. The price target is seen at around CAD 3.00.
It will be exciting on October 14 - CEO Marc Binns will present the Company to the general public at the "International Investment Forum" online conference. The IIF will take place today, October 14, via Zoom. BIGG will present itself at 16.30 German time (CEST). Further information is available at: www.ii-forum.com.
Advanced Micro Devices - Good business, thanks to Corona and cryptos
Advanced Micro Devices, better known as AMD, is one of the primary beneficiaries of the current crypto trend. The California-based manufacturer, which became one of the most important producers of graphics chips (GPUs) with the acquisition of ATI in 2006, managed to increase its sales by around 44% in the crisis year 2020, while net income increased more than sevenfold. The reason for this was, apart from strongly increased PC and notebook sales for homeschooling and home office during the pandemic, the increased demand for graphics cards used for cryptocurrency mining. It is now no longer possible to profitably mine Bitcoin with graphics cards. The calculations for this have become so complex that they require their own high-performance computers for mining other cryptocurrencies such as Ethereum and mining rigs. The combination of several powerful graphics cards is still highly attractive.
However, crypto miners have to share the available hardware with PC gamers and users of the current video game consoles Xbox Series X and PlayStation5, for which AMD produces the graphics units. Thus, there is currently a massive surplus demand for AMD's GPUs. But AMD can also point to numerous innovations in the field of traditional PCs and notebooks. AMD CPUs are now Windows11 compatible. In addition, AMD is currently working with Microsoft on new processors for the latest generation of Microsoft Surface 3 laptops. In addition, AMD's strong diversification into various other industry sectors, such as data centers and artificial intelligence, should boost the share price in the long run.
The FinTech and crypto boom offers many exciting investment opportunities for investors. AMD has been solidly in business for years, and the demand outlook for the future is more than good. Square is also increasingly becoming a solid investment opportunity but at a high valuation. BIGG Digital Assets' solutions are technically mature, and the certification of the trading platform is a big plus.