Did you miss the Shiba Inu? Buy these 3 crypto stocks instead
It’s hard to see a cryptocurrency like Shiba inu (CRYPTO: SHIB) and realizing that you may have missed the mark on some one-off insane returns. But the point is, very few people saw it coming and the reality is that Shiba Inu is an extremely speculative investment that trades with very few fundamentals and a lot of volatility.
The good news is that there are still plenty of other crypto-related investments out there with tons of potential for growth. We’ve compiled a panel of Motley Fool contributors to bring you some great crypto games that are built on real fundamentals. The three that we will discuss here are Bancorp customers (NYSE: CUBI), Workiva (NYSE: WK), and Mercadolibre (NASDAQ: MELI). Here’s why all three can be winners.
An emerging crypto opportunity
Bram Berkowitz (Bancorp Customers): Clients Bancorp has long been at the forefront of the banking industry when it comes to developing advanced technology. The bank has built a banking platform for small businesses that occupies a unique position in the loans of the Small Business Administration (SBA) of the United States. Management believes the platform, which allows corporate borrowers to apply, get a decision, and close loans up to $ 350,000 within 30 days, is the only one of its kind in the country. The bank used this platform to become one of the top paycheck protection program (PPP) lenders in the country when the pandemic hit, causing about $ 10 billion of total payroll volume. PPP loans.
In addition to relying on this platform and selling other banking products to the 315,000 companies it has helped with PPP, clients are also entering the world of crypto. The bank recently built a payment platform called Customers Bank Instant Token (CBIT), a real-time payment system where parties in the network can clear transactions with each other instantly.
While the platform can be used for a variety of industries such as real estate, manufacturing, and logistics, the main use case currently is to better facilitate crypto trading between OTC trading desks. over the counter, crypto exchanges, market makers and investor institutions. The United States does not currently operate on a real-time payment system, but cryptocurrencies are traded around the clock, so these types of payment systems can be very useful.
And once the network is more established, customers can also consider lending digital assets, where they collateralize the US dollar loans with cryptocurrencies. The first indications are very promising for CBIT. In the third quarter, customers had a smooth launch of the platform and quickly collected $ 1.5 billion in deposits that they don’t have to pay interest on from customers joining CBIT.
There are only a few other banks that offer this type of real-time payment platform right now, and they have benefited enormously from it as the platform brings in a lot of non-interest bearing deposits and new ones. customers to sell other traditional banking products to. . The other banks that have this type of platform are trading at much higher valuations than clients, so I think this is a stock with a lot of lead.
Growth opportunities for this business are not fully understood
Keith Noonan (Workiva): The business of Workiva is a bit difficult to understand at first glance. The company’s core software services revolve around providing streamlined, transparent and accurate financial reporting.
Between the rise of cryptocurrencies, soaring prices for homes and other assets, and the increasingly complex nature of the stock markets, financialization is a major trend in today’s investment markets. The recent increase in the number of state-owned enterprises and the need to provide accurate data on business performance is also creating a demand for fintech services that allow businesses to easily capture and transfer information between databases.
This is where Workiva comes in. Workiva provides a subscription-based software platform that enables businesses to easily record, transfer, analyze and submit financial reporting data. In doing so, its software removes risk and reduces potential sources of instability for its customers. The company is benefiting from strong demand dynamics, with revenue up approximately 28% year-over-year in the third quarter and its number of customers with annual contracts valued at over 150 $ 000 up 41% from the previous year period.
Workiva is already expanding into new categories. The company recently launched Marketplace, a platform that allows third-party participants to integrate models and applications into the business ecosystem and make them available to corporate clients. It’s too early to say for sure if this offering will be a big success, but it could become a huge performance driver if things go right. The company’s recent acquisition of OneCloud is also expected to help build data sharing and analytics capabilities in the Workiva suite.
With a market capitalization of approximately $ 7.2 billion, Workiva still has significant room for long-term growth. There is a good chance that the collection, analysis and reporting of financial data will only become more and more important and complex from now on, and the company’s ability to simplify the challenges associated with this trend will be most important. in a good position to show strong growth over the long term. .
Latin America’s Business Digitization Pioneer Continues to Grow
Nicolas rossolillo (MercadoLibre): I decided to take a position in MercadoLibre, the leading e-commerce market in Latin America earlier this month, and plan to buy more stocks soon. The stock is down 15% year-to-date despite impressive numbers including a 67% increase in year-over-year revenue (up 73% excluding currency conversion rates) to $ 1.9 billion in the third quarter of 2021. With an enterprise value of just $ 73 billion, it’s still a small business in the huge Latin American economy.
But what does MercadoLibre have to do with crypto? On the one hand, the company added a little Bitcoin (CRYPTO: BTC) to its balance sheet earlier this year. The company has also been supporting Bitcoin payments and acceptance for a long time, and with El Salvador adopting the original crypto as its official currency this year, MercadoLibre’s early adoption of the crypto market could pay off if more consumers. are turning to digital currencies to fight inflation. . In fact, some reports show that some Latin American countries like Colombia and Argentina have above average cryptocurrency ownership adoption rates.
For now, MercadoLibre’s exposure to Bitcoin and other cryptos is low, but the digitization of emerging economies in South and Central America is still in its infancy. And MercadoLibre, with its e-commerce marketplace, digital payments, and banking and investing services, has huge market opportunities to continue growing, including cryptocurrency.
At around 10 times the expected revenue for the year 2021 and profitable despite heavy investments to support its expansion, the MercadoLibre stock could be trading at a serious long-term value at this time. This company is an economic powerhouse for Latin America and has already helped the region make great strides in the digital age. If you are looking for an investment with huge upside potential over the next decade, there is a lot to like about this ecommerce stock.
This article represents the opinion of the author, who may disagree with the “official” recommendation position of a premium Motley Fool consulting service. We are motley! Challenging an investment thesis – even one of our own – helps us all to think critically about investing and make decisions that help us become smarter, happier, and richer.