In this article, we discuss the 5 best cash app stocks to buy now. If you want to read our detailed analysis of the fintech industry and its future outlook, go directly to 10 Best Cash App Stocks To Buy Now.
5. Paypal Holdings, Inc. (NASDAQ:PYPL)
Number of Hedge Fund Holders: 100
Paypal Holdings, Inc. (NASDAQ:PYPL) deals in the provision of digital payment solutions, allowing users around the world to send and receive electronic payments. It remained a popular stock among hedge funds at the close of the first quarter, with a total of 100 hedge funds reporting ownership of stakes in Paypal worth $6.21 billion. Its leading shareholder at the end of March was Fisher Asset Management, holding a massive stake worth roughly $1.9 billion.
On May 10, analyst James Faucette of Morgan Stanley reiterated an ‘Overweight’ rating on Paypal Holdings, Inc. (NASDAQ:PYPL) shares, and revised the price target to $137 from $139. He feels that the market is missing the company’s outperformance as it continues to outpace underlying e-commerce growth. The company’s revenue trajectory has normalized since coming out of the Covid pandemic, according to the analyst, who notes that this is not a structural issue as feared by some investors.
Paypal Holdings, Inc. (NASDAQ:PYPL) reported EPS figures in-line with estimates at the end of the first quarter. Its Q1 revenue stood at $6.48 billion, beating Street estimates by $75.6 million.
Wedgewood Partners, an investment firm, highlighted a few stocks in its Q1 2022 investor letter, and PayPal Holdings, Inc. (NASDAQ:PYPL) was one of them. The fund said:
“PayPal also detracted from performance during the quarter as investors panicked in the face of the well-telegraphed run-off of eBay’s revenues. We have been aware of the runoff of eBay’s revenues since at least the third quarter of 2017.2 Although markets are supposedly efficient, maybe markets are only as efficient as long as the same shareholders are in the stock. When a shareholder base turns over several, if not dozens, of times over a 5-year time frame, perhaps old news periodically becomes “new” to a market riddled with transient shareholders. In any case, we increased our weightings in the stock for the first time since 2018 as the only thing “new”to us was the highly attractive multiple for a competitively wellpositioned business in the e-commerce industry.”
4. Alibaba Group Holding Limited (NYSE:BABA)
Number of Hedge Fund Holders: 100
Alibaba Group Holding Limited (NYSE:BABA) is one of the world’s largest e-commerce platforms. Its fintech arm called Ant Group was scheduled to make the world’s largest IPO in 2020, with a $35 billion dual listing in Shanghai and Hong Kong, which was eventually called off by Chinese regulatory authorities. This fintech division offers the AliPay electronic payment system, which is used all over China and is integrated with Alibaba.com platforms such as AliExpress, Taobao Marketplace, and Tmall.
On May 27, Barclays analyst Jiong Shao lowered the firm’s price target on Alibaba Group Holding Limited (NYSE:BABA) to $200 from $220 and maintained a ‘Buy’ rating on the company shares. The analyst holds that “once the dust settles,” Alibaba should remain a dominant e-commerce platform in China that boasts “impressive earnings power.”
Alibaba Group Holding Limited (NYSE:BABA) posted an EPS of $1.18 for the first quarter, beating consensus estimates by $0.10. The company’s revenue over the quarter was recorded at $30.3 billion, above analysts’ forecasts by $555.4 million.
Investors were seen buying up on Alibaba Group Holding Limited (NYSE:BABA) stock. At the end of the first quarter, 100 hedge funds were long on the company shares, as compared to 96 hedge funds a quarter ago. The firm’s largest shareholder in the first quarter was Fisher Asset Management, with 14.44 million shares priced at $1.57 billion.
However, investment firm Baron Funds expressed bearish sentiment when talking about Alibaba Group Holding Limited (NYSE:BABA) in its Q1 2022 investor letter. It said:
“We have eliminated 6 holdings during the first quarter (including) Alibaba. We have sold our Alibaba Group Holding Limited position as the company continues to face competitive challenges and regulatory pressures remain, making it difficult (if not impossible) to appropriately assess the range of outcomes and associated probabilities for the future profitability of the business.”
3. Apple Inc. (NASDAQ:AAPL)
Number of Hedge Fund Holders: 131
Apple Inc. (NASDAQ:AAPL) is the tech giant behind iPhones and Mac computers. Over the past few years, it has forayed into many new business avenues to benefit from its large size and loyal brand following. It launched digital payment app called Apple Pay in 2014, which today dominates the US mobile payment market with a nearly 44% share. In the United Kingdom as well, six out of ten people used Apple Pay for point-of-sale (POS) transactions in 2021.
Wedbush analyst Daniel Ives on May 20 kept an ‘Outperform’ rating on Apple Inc. (NASDAQ:AAPL) shares, along with a $200 price target. Ives called Apple a compelling stock to hold and ride out the market storm. As of May 27, the company shares have gained 20.41% in the last 12 months.
Apple Inc. (NASDAQ:AAPL) ranks among the most widely held stocks, with 131 hedge funds reporting ownership of stakes in the company at the close of the first quarter. This is down from 134 hedge funds in the preceding quarter.
For Q1 2022, Apple Inc. (NASDAQ:AAPL) reported earnings per share of $1.52, exceeding estimates by $0.09. The company’s revenue for the quarter was $97.3 billion, outperforming analysts’ forecasts by $3.3 billion.
ClearBridge Investments mentioned Apple Inc. (NASDAQ:AAPL) in its Q4 2021 investor letter. Here’s what the fund said:
“Despite these mixed emerging growth results, the ClearBridge Global Growth Strategy outperformed the benchmark due to resilience among our secular and structural growth holdings. The bulk of these contributions came from U.S. mega-cap growth stocks Apple and Microsoft which continued to uniquely act both offensively and defensively as they have through most of the pandemic.”
2. Visa Inc. (NYSE:V)
Number of Hedge Fund Holders: 159
Visa Inc. (NYSE:V) is a world leader in digital payments, enabling transactions between users, merchants, governments and businesses in more than 200 countries and territories around the globe. In 2021, the company’s services were used by more than 80 million merchants worldwide, which showed a 14% year-on-year growth.
On May 17, Goldman Sachs analyst Will Nance initiated coverage of Visa Inc. (NYSE:V) with a ‘Buy’ rating and a $282 price target, implying a 43% upside. The analyst also added the company shares to the firm’s ‘Americas Conviction List’. He sees the firm as a global leader with “attractive leverage to the long-term secular growth driver from payment electronification.”
According to the Q1 database of Insider Monkey, 159 hedge funds held $28.07 billion worth of positions in Visa Inc. (NYSE:V). This shows growing investor confidence in the company over the previous quarter, where 142 hedge funds were long on the company shares. With a stake worth $19.94 billion, Adam Capital was the most prominent shareholder of Visa Inc. (NYSE:V) at the close of the first quarter.
The firm’s EPS for the first quarter stood at $1.79, coming in above estimates by $0.14. $7.19 billion in revenue for the quarter was also recorded above market estimates by $366.9 million, signalling year-on-year growth of 25.48%.
Here is what Baron Funds, an investment firm, had to say about Visa Inc. (NYSE:V) in its Q1 2022 investor letter:
“Shares of global payment network Visa, Inc. (NYSE:V) were up 2.5% on strong quarterly results with 24% revenue growth and 27% EPS growth. Payment volume grew 20% with notable strength in cross-border volumes as travel activity rebounded from depressed levels. Management raised full-year guidance to reflect high-teens revenue growth. Shares also likely benefited from a “flight to safety” during a volatile quarter for equities. We continue to own the stock due to Visa’s long runway for growth underpinned by the continued migration from cash transactions to card/digital and strong competitive advantages, operating in a duopoly with Mastercard.”
1. Alphabet Inc. (NASDAQ:GOOG)
Number of Hedge Fund Holders: 160
Alphabet Inc. (NASDAQ:GOOG) is the parent company of Google and its affiliated platforms. It also operates Google Pay, an Android software which allows cashless transactions at point-of-sale systems using NFC (near-field communication) technology in smartphones. In May 2022, the company announced the launch of Google Wallet, a comprehensive, all-in-one platform where users can save official documents, concert tickets, credit cards and make online and contactless payments.
On April 27, Jefferies analyst Brent Thill reiterated a ‘Buy’ rating on Alphabet Inc. (NASDAQ:GOOG) shares and decreased the price target to $3,400 from $3,600. He noted that the company posted strong growth in its Search and Cloud business, but reported below-expectations revenue from YouTube for the third straight quarter.
In Q1 2022, Alphabet Inc. (NASDAQ:GOOG) posted revenue of $68 billion, which was a jump of 22.95% from the year-ago quarter, and also exceeded consensus estimates by $124.6 million. EPS stood at $24.62, missing consensus estimates by $0.93.
160 hedge funds reported owning positions in Alphabet Inc. (NASDAQ:GOOG) at the end of Q1 2022, showing a positive trend from the preceding quarter where 158 hedge funds were long on the company shares.
Investment firm Baron Funds mentioned Alphabet Inc. (NASDAQ:GOOG) in its Q1 2022 investor letter. The fund stated:
“We have modestly reduced the size of our position in Alphabet Inc. (NASDAQ:GOOG) (from 6.5% at the end of the fourth quarter of 2021 to 5.3% as of the end of the first quarter of 2022), after the stock rallied 64% in 2021 and continued outperforming during the first quarter, declining just 3%.”
You can also take a look at 10 Best Safe Blue Chip Dividend Stocks and 12 Best Bear Market Stocks to Buy Now.
