E-commerce transactions continue their upward trend without pause, and a group of category leaders are showing continued strength, including Adyen, Shopify, and Square. It’s no surprise that Wall Street and industry players are watching with interest, given M&A activity is already off to a fast start for 2019. Payment gateways, e-commerce shopping platforms, and mobile point-of-sale vendors are among the top of the rising tide of digital commerce that floats all boats.
A Barron’s article discusses more on this topic which is excerpted below.
Amazon.com ’s growing influence—and the ubiquity of smartphones—has fueled a growing mobile commerce market that is expected to double to $1.5 billion by 2022.
The trend has had a profound influence on traditional retailers, leading Walmart, Target, and others to aggressively ramp up so-called omnichannel and “click and collect” strategies to chip away at Amazon’s dominance.
KeyBanc Capital Markets assessed the tech companies most likely to take advantage. In a Sunday note to clients, KeyBanc analyst Josh Beck suggests global payment company Adyen is best-positioned based on its success with customers like Nike and Gap. He raised his price target on the Amsterdam-based company to $978.39 and maintained its Overweight rating.
KeyBanc initiated coverage of another contender, Shopify, with an Overweight rating and a price target of $250, which is about 10% higher than its current stock price. Beck is bullish on the company’s proven ability to innovate quickly, its partner ecosystem, and its international initiatives to localize its products. Square (SQ), the “other” tech company co-founded by Twitter (TWTR) CEO Jack Dorsey, also was highlighted in the KeyBanc report.
Overview by Raymond Pucci, Director, Merchant Services at Mercator Advisory Group
