5 Best Beginner Stocks to Invest in Right Now

1. Square, Inc. (NYSE: SQ) 

Number of Hedge Fund Holders: 92 

Square, Inc. (NYSE: SQ) stands first on our list of the best beginner stocks to invest in right now. The company provides financial services to its customers and mainly operates in digital payments. The Q1 2021 revenue of Square, Inc. (NYSE: SQ) stands at $5.05 billion, rising above the $3.36 billion expectation of the analysts. 

With a rise in card payments globally, Square, Inc. (NYSE: SQ) is all set to benefit from its mobile payment service, Cash App. In 2020, Cash App managed to increase its users by 12 million, drawing the attention of investors. The SQ stock price has also grown by 138% in the past year and 11% in the past month. The stock has also delivered a 134% return to its shareholders in the past year. 

As of Q1 2021, 92 hedge funds tracked by Insider Monkey own stakes in Square, Inc. (NYSE: SQ), compared with 89 funds in a quarter earlier. The total value of these stakes is $9.2 billion. 

RiverPark Funds, an investment management fund, released its first-quarter 2021 investor letter and mentioned Square, Inc. (NYSE: SQ) in it. Here is what the firm has to say: 

“We established a position in leading Financial Technology provider Square during the quarter. Through one integrated system, SQ is a hybrid of two businesses: its Seller Business (charging small and medium-sized businesses about 3% for transaction payment processing, plus other services such as instant funds access, and software for everything from customer engagement to payroll), and its Cash App (originally for person-to-person cash transfers and now a growing digital financial services provider for consumers).

The combined business has grown gross profit at a 37% CAGR over the past five years to $2.7 billion (due to pass through costs, gross profit is more reflective of top-line growth) and we believe that the company has an enormous long-term runway, as it has less than a 2% share of a more than $160 billion market. It is our view that the company’s Cash App (which has grown

from nothing in 2015 to $1.2 billion gross profit last year) has a particularly large opportunity with its powerful ecosystem of digital financial services including digital wallets, direct deposits, stock trading, bitcoin trading, and business and tax services, which are all relatively new. The vast majority of Cash App’s more than 36 million users are younger and, importantly, are willing to replace their bank and other financial services accounts with the app.

We estimate that the company can grow its gross profit more than 30% and EBITDA more than 50% annually for the foreseeable future, and while most of the company’s current profit is from its Seller Business, we believe most of Square’s future value will be from its Cash App business.”

You can also take a peek at Top 10 High Growth Stocks To Buy in 2021 and 10 Safe Stocks To Invest in For Long Term.

Follow Insider Monkey on Twitter