Jan 08, 2025 (MENAFN via COMTEX) --
(MENAFN - Yolo Wire) Small-cap stock %Shift4Payments (NYSE: $FOUR) has shown that it has big growth potential.
The payment processor based in Allentown, Pennsylvania was founded in 1999. Today, it processes payments for over 200,000 businesses in the retail, hospitality, leisure, and restaurant industries.
The company has a bit of an edge in that it specializes in commerce solutions such as mobile payment software and hardware.
Although it has been a going concern for 25 years, Shift4 Payments only went public on the New York Stock Exchange in 2020 during the depths of the Covid-19 pandemic.
However, the company and its stock have proven to be much stronger and more resilient than many other concerns that made their market debuts in the last five years.
In 2024, Shift4 Payments’ stock rose 46%, doubling the 23% gain in the benchmark S&P 500 index.
Since its initial public offering (IPO) in 2020, FOUR stock has gained an impressive 218% and avoided much of the volatility that has rocked the financial technology sector and small-cap stocks.
With a market capitalization of $9.60 billion U.S., Shift4 Payments is barely a small-cap stock, which is loosely defined as any security that has a market value of less than $10 billion U.S.
Still, the company is small compared to much larger companies such as %PayPal (NASDAQ: $PYPL), Affirm Holdings (AFRM), and other payment specialists.
But despite being small, Shift4 has outperformed most of its peers. In the past five years, PayPal’s stock has declined 20% while Affirm’s share price has fallen 45%.
Shift4 Payments has also attracted interest from some notable investors. It is currently a core holding of investor Michael Burry, accounting for 10% of his portfolio.
Burry famously shorted the subprime mortgage market ahead of the 2008 financial crisis, an event chronicled in the book and film “The Big Short.”
If there is a drawback to Shift4 Payments stock, it is that the company’s valuation has gotten rich, trading at 58 times future earnings estimates.
Still, the stock appears to have momentum and is poised for future growth fueled by accelerating earnings.
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COMTEX_461666118/2604/2025-01-08T06:37:37
