This little-known Canadian payment provider just joined the U.S. markets — could it be the next up-and-coming player in the FinTech sector?
Dec. 10, 2021
Nuvei (NASDAQ: NVEI) is a global payments solution company established in 2003, led by founder and CEO Philip Fayer. The company was recently listed on the NASDAQ, raising a total of $425 million in order to strengthen its balance sheet and fund investment in international growth.
What does Nuvei do?
Nuvei offers wireless point of sale terminals, mobile and online payments solutions, compatible with over 150 currencies and available in more than 20 languages. It supports 500 alternative payment methods, including Apple pay, Google Pay, Paypal, Visa, and Mastercard. Salesforce, Wix, and Shopify are among the enterprise solutions companies that have already partnered with Nuvei.
Nuvei is profitable as of Q1 2021, and it has increased profitability since then, having produced $28 million in net income in its most recent quarter. The company’s current margins are 44%, with the intention to increase this figure to over 50% in the coming years. This is lower than powerhouses like Mastercard and Visa, but well above the industry average.
Nuvei also grew its total overall revenue by 96% year-over-year. Filtered by region, there was 118% growth in North America, 93% growth in Latin America (LATAM), 140% growth in the Asia Pacific, and even a modest 62% in Europe, the Middle East, and Africa.
Nuvei’s growth potential
The company is expanding aggressively in the LATAM region, a market valued at over $120 billion, with its acquisition of payments solution firm, Paymentez. It has also acquired bank-to-bank transfers company Mazooma, a specialist in payment solutions in the gambling industry. Not stopping there, it’s tackling the cryptocurrency space with its Simplex acquisition, which provides the infrastructure for the purchase and sale of digital currencies.
Is Nuvei a good investment?
The company is certainly not without risk — it appears to be overly dependent on the gambling sector, and we’re all aware of the volatility associated with the crypto-sphere. Being relatively new to the capital markets — in the U.S. at least — it might be one to keep an eye on, but as it stands, there’s nothing distinctive enough about the business that sparks my interest as an investor.