This fintech stock may not be an unknown for much longer
- Shift4 appears poised to go into high gear in 2025.
Will Healy (Shift4 Payments, Inc.): Despite a long existence, Shift4 (FOUR -1.02%) is far from becoming a household name, even among the fintech stocks with which it competes. The current CEO Jared Isaacman founded this company in 1999 to offer a faster payments processing alternative.
Over time, Shift4 differentiated itself from fintech companies like PayPal (PYPL -0.09%) and Block (SQ -2.85%) by targeting restaurants and hospitality-related venues such as resorts, casinos, and sporting venues. Among its more high-profile clients are the Nobu Hotel, Yosemite National Park, and sports venues such as Lucas Oil Stadium, home of the Indianapolis Colts.
Also, it has expanded beyond the U.S. to Canada, Japan, and most countries in Europe and is pursuing strategic partnerships in other countries. This approach helped it grow to the point that it serves over 200,000 customers and processes more than $260 billion in payments annually. Not surprisingly, its financials reflect its success.
In the first six months of 2024, revenue of $1.5 billion rose 30% from year-ago levels. Shift4 also kept its expense growth in check, allowing the net income attributable to Shift4 for the first half of the year to grow to $60 million, a 50% yearly increase.
Moreover, amid a 110% increase in the stock price over the last year, taking it close to the all-time highs it reached in the 2021 bull market.
Furthermore, projections indicate the company’s growth is not slowing down. The P/E ratio is now 55, and so high is the anticipated growth that its forward P/E ratio stands at just 24.
Such increases have helped Shift4 quietly recover from the 2022 bear market. However, as Shift4 stock approaches record highs, 2025 could be the year when investors finally begin to pay attention to the stock. Hence, it might pay to open a position before others take notice.
