The 3 Most Undervalued Fintech Stocks to Buy in February 2023
InvestorPlace – Stock market news, stock advice and trading tips
All three undervalued fintech stocks to buy in February 2023 are significantly up compared to S&P 500. As a result, all three should continue to outperform the index throughout the year.
Typically, when choosing stocks to buy from a specific industry or group well represented by mutual funds, I choose the companies from a popular fund. The largest fintech ETF by net assets is ARK Fintech Innovation ETF (NYSEARCA:ARKF), with 659.4 million dollars. This is an actively managed fund from Cathie Wood. It currently has 29 shares. Unfortunately, none of my three undervalued fintech stocks made her cut.
The Global X FinTech ETF (NASDAQ:FINX) have 472.4 million dollars in net assets distributed among 66 holdings. All three of my choices missed the cut once again.
However, you don’t need to worry. The names on this short list of undervalued fintech stocks are all well-run businesses with plenty of growth ahead on both the top and bottom lines. They range from $2 billion in market capitalization to nearly $20 billion. They are listed in order of how confident I am that you will make money from each in the long term.
SIVB
SVB Finance Group
$323.21
WEX
Wex
$188.41
BFH
Bread Financial Holdings
$42.79
SVB Financial (SIVB)
Source: Pavel Kapysh / Shutterstock.com
SVB Finance Group (NASDAQ:SIVB) is a diversified financial company with four operating segments: Silicon Valley Bank, SVB Capital, SVB Private and SVB Securities. The company, which was named one of America’s best banks by Forbeshelps innovators and entrepreneurs grow their businesses by providing banking products and services.
With $212 billion in assetsa loan portfolio of $74 billion and $342 billion in client funds under administration and management, SVB Financial is likely to catch investors’ eyes as they return to tech stocks with some confidence.
SVB Financial has been my favorite bank stock for years. It is down 46% over the past 52 weeks. However, it has come to life in 2023, gaining more than 40% year-to-date and 29% since the company reported its fourth-quarter and full-year results on January 19.
Profits were significantly lower in the quarter, with net income of $275 million compared to $371 million a year ago and $429 million in Q3 2022. However, it reported that its customer base was starting to do slightly better financially, giving hope for the future. In addition, loans at the end of the period were $74.3 billion, 2.9% higher than the previous quarter. And non-GAAP core fee income of $349 million was 10.4% higher than in the third quarter.
The shares trade at a price-to-book ratio of 1.6, well below the five-year average of 2.5.
