Earlier this week, I’d analyzed Canadian tech companies such as Shopify and Constellation Brands to see if they have the potential to be millionaire-maker stocks. A stock that gains 10 times its value over two decades can be considered a millionaire maker. I’ll take a look at another Canadian tech stock, Nuvei (TSX:NVEI), to see if it can turn $100,000 into $1 million within the next 20 years.
Nuvei is a quality growth stock
Nuvei is a global payment technology partner that also provides intelligence and data for enterprises to accelerate their decision-making processes. It helps businesses remove payment barriers, increase acceptance rates, and optimize operating costs. The company has a proprietary platform that provides robust payment capabilities, connecting merchants with customers in 204 markets all around the world.
Nuvei already supports 480 local and alternative payment methods for 150 currencies as well as 40 cryptocurrencies. Its integrated platform lets customers accept multiple payment options, making it easier for them to expand into new markets as payment barriers are reduced. The company’s customizable and integrated suite of solutions allows businesses to convert more sales, enhance customer relationships, and reconcile global operations while reducing costs.
The demand for fintech solutions has gained pace amid COVID-19, enabling Nuvei to increase sales from $245 million in 2019 to $375 million last year.
Acquisitions will drive revenue higher for Nuvei in 2021 and beyond
Nuvei’s sales stood at just $124 million in 2017 and are forecast to touch $918 million next year. The fintech heavyweight has successfully expanded its suite of solutions, which has driven sales higher. However, Nuvei has also aggressively acquired firms that have been highly accretive to revenue and earnings.
It recently completed the acquisition of Simplex, which is a fiat-cryptocurrency gateway that connects market participants. Nuvei also acquired Paymentez, which is a payment solution provider in Latin America. The company announced a partnership with 888 Holdings, which is one of the largest online betting and gaming companies in the world. Here, Nuvei will provide its instant bank transfer payment solution to SI Sportsbook, a subsidiary of Authentic Brands, which has collaborated with 888 Holdings.
We can see that Nuvei is not only eyeing expansion in rapidly expanding verticals such as cryptocurrency and online gaming; it’s also gaining traction in growth markets across Latin America.
In the second quarter of 2021, the total volume of transactions processed on the Nuvei platform rose by 146% year over year to $21.9 billion. In the first six months of 2021, this metric stood at $42.5 billion compared to $17.8 billion in the year-ago period. Comparatively, its revenue rose by 114% to US$178.2 million in Q2, while the top line almost doubled to $328.7 million in the first two quarters.
While several growth stocks in the technology sector are grappling with massive losses, Nuvei’s adjusted EBITDA rose by 112% to $79.4 million, indicating a robust margin of 44.5%. In the first six months of 2021, its adjusted EBITDA stood at $144.8 million.
What’s next for NVEI stock?
Investors might be worried about Nuvei’s steep valuation. But the company is well poised to crush broader market returns in 2021 and beyond. NVEI stock has already returned 262% to investors since its IPO last year and should be a millionaire maker by the end of the current decade.
