Tag Archives: nasdaq

PayPal Venmo Stacks Up Well Vs. Apple Pay, Google’s Android Pay

Based on a survey of 1,000 PayPal ( PYPL ) customers, an analyst says that the company isn’t getting enough credit for the potential impact of its peer-to-peer payments app, Venmo. According to Jefferies analyst Jason Kupferberg, investor concerns over the  Apple ( AAPL ) Pay competitor are exaggerated — PayPal’s mobile sales continue to grow and have, in fact, accelerated since Apple released its payments app, he says in a research note. Venmo is a mobile app that enables friends and family to share expenses such as rent, meals and cab fare. Google, a unit of Alphabet ( GOOGL ), also competes in the payments game with its Android Pay. Though PayPal executives continue to emphasize the firm’s “platform agnostic” approach — it isn’t tied to an operating system or platform — and say that neither Apple nor Google is a real threat, some industry watchers disagree. Alex Rampell, a general partner at noted VC firm Andreesseen Horowitz, likened the prospects of either Apple or Google taking a bigger interest in payments to the Death Star — the planet-destroying battle station in “Star Wars” — approaching for all other rivals. “This isn’t the ‘Empire Strikes Back,’ ” Rampell has told IBD in the past. “This is the Death Star coming.” Kupferberg wrote in a research note Monday that PayPal earnings will accelerate due to transactions conducted with the Venmo app. Venmo is free for now, but PayPal executives say that they plan to monetize the app, which is popular with millennials. They say that PayPal plans to allow selected PayPal merchants to accept payment via the Venmo app — and PayPal would charge its typical transaction fee (2.9%, according to Fortune magazine) in the process. According to Kupferberg, 67% of Venmo users would use the Pay With Venmo feature one or twice a month, with 44% using it three to five times a month, and 19% using it six to 10 times per month. Kupferberg says that Pay With Venmo transactions will yield larger profit margins because Venmo customers typically fund their accounts with debit cards, bank accounts and stored balances — the result of others sending cash. PayPal stock was up more than 2%, near 38, in afternoon trading on the stock market today . The San Jose-based company has an IBD Composite Rating of 91, where 99 is the highest. The stock has had a choppy few months since its spin-off from eBay ( EBAY ) in July. It hit its high of 42.55 during its first trading session on Nasdaq and has plunged to as low as about 30 on several occasions. At least one analyst says that the sell-off has been too hasty . Kupferberg’s price target for PayPal stock is 44. PayPal has recently settled a lawsuit over a perennial issue that the company faces: locked accounts.

Best And Worst Q1’16: All Cap Value ETFs, Mutual Funds And Key Holdings

The All Cap Value style ranks fourth out of the twelve fund styles as detailed in our Q1’16 Style Ratings for ETFs and Mutual Funds report. Last quarter , the All Cap Value style ranked fourth as well. It gets our Neutral rating, which is based on aggregation of ratings of 11 ETFs and 272 mutual funds in the All Cap Value style. See a recap of our Q4’15 Style Ratings here. Figure 1 ranks from best to worst the seven all-cap value ETFs that meet our liquidity standards and Figure 2 shows the five best and worst-rated all-cap value mutual funds. Not all All Cap Value style ETFs and mutual funds are created the same. The number of holdings varies widely (from 20 to 2025). This variation creates drastically different investment implications and, therefore, ratings. Investors seeking exposure to the All Cap Value style should buy one of the Attractive-or-better rated ETFs or mutual funds from Figures 1 and 2. Figure 1: ETFs with the Best & Worst Ratings – Top 5 Click to enlarge * Best ETFs exclude ETFs with TNAs less than $100 million for inadequate liquidity. Sources: New Constructs, LLC and company filings Five ETFs are excluded from Figure 1 because their total net assets are below $100 million and do not meet our liquidity minimums. Figure 2: Mutual Funds with the Best & Worst Ratings – Top 5 Click to enlarge * Best mutual funds exclude funds with TNAs less than $100 million for inadequate liquidity. Sources: New Constructs, LLC and company filings The Northern Lights Fund Trust II Al Frank Fund ( VALAX , VALUX ) is excluded from Figure 2 because its total net assets are below $100 million and do not meet our liquidity minimums. The PowerShares FTSE RAFI US 1000 Portfolio ETF (NYSEARCA: PRF ) is the top-rated All Cap Value ETF and the Transamerica Partners Institutional Large Value Fund (MUTF: DIVIX ) is the top-rated All Cap Value mutual fund. PRF earns an Attractive rating and DIVIX earns a Very Attractive rating. The First Trust Value Line Dividend ETF (NYSEARCA: FVD ) is the worst-rated All Cap Value ETF and the Copley Fund (MUTF: COPLX ) is the worst-rated All Cap Value mutual fund. FVD earns a Neutral rating and COPLX earns a Very Dangerous rating. Wells Fargo & Company (NYSE: WFC ) is one of our favorite stocks held by PRF and earns an Attractive rating. Wells Fargo was also featured as a long idea in November2015. Wells Fargo’s ability to grow after-tax profits ( NOPAT ) has been extremely impressive. Over the past decade, the company has grown NOPAT by 12% compounded annually. Over this same time, Wells Fargo has consistently earned a double-digit return on invested capital ( ROIC ) and over the trailing-twelve-months, earns an 11% ROIC. Despite the impressive business strength, the company remains undervalued. At its current price of $48/share, Wells Fargo has a price-to-economic book value ( PEBV ) ratio of 0.9. This ratio means that the market expects the company’s NOPAT to permanently decline by 10% from current levels. If Wells Fargo can grow NOPAT by just 5% compounded annually for the next decade , the stock is worth $67/share today – a 40% upside. Orbcomm Inc. (NASDAQ: ORBC ) is one of our least favorite stocks held by FRAVX and earns a Dangerous rating. Over the past five years, Orbcomm’s NOPAT has declined by 20% compounded annually. In fact, the business has never generated positive economic earnings in any year since going public in 2006. Orbcomm currently earns a bottom-quintile ROIC of 1%. In spite of the poor fundamentals, ORBC is up nearly 20% in the last year and is now significantly overvalued. To justify its current price of $7/share, Orbcomm must grow NOPAT by 34% compounded annually for the next 14 years. Figures 3 and 4 show the rating landscape of all All Cap Value ETFs and mutual funds. Figure 3: Separating the Best ETFs From the Worst Funds Click to enlarge Sources: New Constructs, LLC and company filings Figure 4: Separating the Best Mutual Funds From the Worst Funds Click to enlarge Sources: New Constructs, LLC and company filings D isclosure: David Trainer and Kyle Guske II receive no compensation to write about any specific stock, style, or theme. Disclosure: I/we have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it. I have no business relationship with any company whose stock is mentioned in this article.