Financials & FinTech research, Galliano’s Financials Research

Victor Galliano

Financials & FinTech research

Financials & FinTech, EM & Developed Markets

Galliano’s Financials Research

Galliano's Financials Research provides fundamental research in Emerging Markets financials, including FinTech, as well as financials in select Developed Markets.

The investment style applied is generally value oriented, although Growth At Reasonable Price (GARP) strategies can also be used where appropriate. 

Our investment research approach aim is often contrarian, looking to capitalise on overly sceptical or optimistic consensus views. In terms of valuation techniques, the focus is on PBV ratio to ROE, PE multiples and dividend yield, as well as the application of PEG ratios and, where appropriate, Sum of the Parts (SOTP) valuations.

Equity Capital Markets

<ul>
<li>Klarna’s IPO issue price of USD40 implies a market capitalisation of USD15.1bn and, according to financial press reports, the IPO was twenty-five times over-subscribed</li>
<li>The Klarna IPO valuation metrics, versus its peers, still serves to highlight Affirm’s very stretched valuation and we stand by our Affirm sell rating</li>
<li>On the positive side, we highlight PayPal as also the best value play of the major BNPL participants; we also like PagSeguro and Nexi</li>
</ul>


Klarna’s IPO issue price of USD40 implies a market capitalisation of USD15.1bn and, according to financial press reports, the IPO was twenty-five times over-subscribed
The Klarna IPO valuation metrics, versus its peers, still serves to highlight Affirm’s very stretched valuation and we stand by our Affirm sell rating
On the positive side, we highlight PayPal as also the best value play of the major BNPL participants; we also like PagSeguro and Nexi


Klarna IPO (KLAR US) – Premium Pricing Out of the Gate, Still a Threat to Affirm’s Current Valuation

<ul>
<li>Klarna shares are set to start NYSE trading on 10 September; the issue price range implies a market capitalisation of USD12.8bn to USD13.6bn; we believe that its valuation looks underwhelming</li>
<li>The Klarna IPO valuation versus its peers does, however, show Affirm’s very stretched valuation and we downgrade it to a sell; we upgrade Kakao Pay to a neutral from sell</li>
<li>We keep PagSeguro, PayPal and Nexi on the buy list for their value credentials; we believe that PayPal is also the best value of the major BNPL players</li>
</ul>


Klarna shares are set to start NYSE trading on 10 September; the issue price range implies a market capitalisation of USD12.8bn to USD13.6bn; we believe that its valuation looks underwhelming
The Klarna IPO valuation versus its peers does, however, show Affirm’s very stretched valuation and we downgrade it to a sell; we upgrade Kakao Pay to a neutral from sell
We keep PagSeguro, PayPal and Nexi on the buy list for their value credentials; we believe that PayPal is also the best value of the major BNPL players


Klarna IPO (KLAR US) - Underwhelming Valuations Against Key Comparables

Equity Bottom-Up

<ul>
<li>We introduce our payments scorecard in this report, in which we apply weightings to our metrics of valuation, margins, EBITDA growth estimates and valuation-to-growth to deliver rankings</li>
<li>We keep PagSeguro and Nexi on the buy list, both of these are in the top three in the scorecard; we add PayPal to the buys, replacing the mega-cap Visa</li>
<li>We remove our sell rating on Affirm, replacing it with Kakao Pay; Kakao Pay stock has rallied hard on stablecoin speculation, but our concern is that investors under-estimate regulatory risk</li>
</ul>


We introduce our payments scorecard in this report, in which we apply weightings to our metrics of valuation, margins, EBITDA growth estimates and valuation-to-growth to deliver rankings
We keep PagSeguro and Nexi on the buy list, both of these are in the top three in the scorecard; we add PayPal to the buys, replacing the mega-cap Visa
We remove our sell rating on Affirm, replacing it with Kakao Pay; Kakao Pay stock has rallied hard on stablecoin speculation, but our concern is that investors under-estimate regulatory risk


Payment Companies – Introducing the Sector Scorecard

Independent research on the U.S. markets, Baptista Research

Baptista Research

Independent research on the U.S. markets

Baptista Research is an independent financial research house focused on the U.S. markets. We provide equity research as well as credit research reports on the top-listed U.S. companies with most of our focus on technology, consumer goods and services, automobiles, industrials, oil and gas, pharma, and healthcare. Our research has served more than 3000 institutional investors including mutual funds, hedge funds, banks, family offices, and various buy-side firms. We operate a research subscription service where institutions, as well as retail investors, can have priority access to all our research. We also have a wide distribution of our research reports across some of the top global financial platforms. Apart from equity research and credit research, we also provide advisory services with respect to mergers & acquisitions (M&A), private equity/ venture capital fundraising, valuation reports, and investment management services for corporates.
Baptista Research is owned and managed by Ishan Majumdar, an ex-Venture Capitalist/ Investment Banker, a Chartered Accountant, and a Masters’ degree holder in Management from HEC Paris. Ishan has nearly a decade of experience in Mergers and Acquisitions, Leveraged Buyouts (LBOs), Venture Capital Investing, Corporate Strategy, and Valuation in front-office roles at the likes of BNP Paribas CIB, Credit Agricole CIB, Groupe Danone, and TIW Private Equity. He has worked on and closed multiple acquisition deals, leveraged buyouts, and start-up investment transactions.

<ul><li>PagSeguro Digital's first quarter of 2025 earnings reveal a nuanced financial landscape for the company, emphasizing both growth and challenges amid a fluctuating macroeconomic environment.</li><li>The quarter was marked by a notable increase in total payment volume (TPV) and client base expansion, despite a slowdown in TPV growth compared to the previous quarter.</li><li>The company reported strong financial outcomes, featuring a 13% year-over-year increase in net revenue, amounting to BRL 4.9 billion.</li></ul>

PagSeguro Digital's first quarter of 2025 earnings reveal a nuanced financial landscape for the company, emphasizing both growth and challenges amid a fluctuating macroeconomic environment.The quarter was marked by a notable increase in total payment volume (TPV) and client base expansion, despite a slowdown in TPV growth compared to the previous quarter.The company reported strong financial outcomes, featuring a 13% year-over-year increase in net revenue, amounting to BRL 4.9 billion.

PagSeguro Digital: Leveraging Digital Payments & E-commerce To Ensure Sustained Growth Both In Market Share & Revenue!

<ul><li>PagSeguro Digital presented its fourth quarter 2024 results, showcasing notable growth in both its banking and payment segments.</li><li>The company continued to expand its customer base, now at 33.2 million clients, with significant progress in both its revenue and earnings per share (EPS).</li><li>However, the discussion of these results reveals a mixture of strengths and potential challenges for the company.</li></ul>

PagSeguro Digital presented its fourth quarter 2024 results, showcasing notable growth in both its banking and payment segments.The company continued to expand its customer base, now at 33.2 million clients, with significant progress in both its revenue and earnings per share (EPS).However, the discussion of these results reveals a mixture of strengths and potential challenges for the company.

PagSeguro Digital: Expanding Collateralized Loan Portfolio & Major Growth Drivers!

Brazil

PagSeguro Digital Ltd. is a Brazilian financial technology company that provides digital payment and financial solutions primarily for consumers, individual entrepreneurs, micro-merchants, and small to medium-sized businesses. The company offers a range of products including point-of-sale (POS) devices, online payment tools, digital banking services via PagBank, and various credit and investment solutions. It was founded in 2006 and is headquartered in São Paulo, Brazil.

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PagSeguro Digital (PAGS US)

Klarna IPO (KLAR US) – Premium Pricing Out of the Gate, Still a Threat to Affirm’s Current Valuation

Klarna's IPO price shows strong demand, while Affirm's valuation remains stretched and it looks exposed to a de-rating. We see PayPal, PagSeguro,...

Victor Galliano

Klarna IPO (KLAR US) - Underwhelming Valuations Against Key Comparables

Klarna is due to IPO, with its valuation underwhelming relative to peers; we downgrade Affirm to a sell due to very rich valuations, and we stick...

Victor Galliano

Payment Companies – Introducing the Sector Scorecard

We introduce our payments scorecard; PagSeguro and Nexi remain buys, while PayPal replaces Visa. Affirm is replaced on the sell list by Kakao Pay...

Victor Galliano

PagSeguro Digital: Expanding Collateralized Loan Portfolio & Major Growth Drivers!

PagSeguro Digital presented its fourth quarter 2024 results, showcasing notable growth in both its banking and payment segments. The company...

Baptista Research

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)

Klarna IPO (KLAR US) – Premium Pricing Out of the Gate, Still a Threat to Affirm’s Current Valuation

​Klarna's IPO price shows strong demand, while Affirm's valuation remains stretched and it looks exposed to a de-rating. We see PayPal, PagSeguro,...

Victor Galliano

Klarna IPO (KLAR US) - Underwhelming Valuations Against Key Comparables

​Klarna is due to IPO, with its valuation underwhelming relative to peers; we downgrade Affirm to a sell due to very rich valuations, and we stick...

Victor Galliano

Payment Companies – Introducing the Sector Scorecard

We ​introduce our payments scorecard; PagSeguro and Nexi remain buys, while PayPal replaces Visa. Affirm is replaced on the sell list by Kakao Pay...

Victor Galliano

PagSeguro Digital: Leveraging Digital Payments & E-commerce To Ensure Sustained Growth Both In Market Share & Revenue!

PagSeguro Digital's first quarter of 2025 earnings reveal a nuanced financial landscape for the company, emphasizing both growth and challenges...

Baptista Research

PagSeguro Digital: Expanding Collateralized Loan Portfolio & Major Growth Drivers!

PagSeguro Digital presented its fourth quarter 2024 results, showcasing notable growth in both its banking and payment segments. The company...

Baptista Research

Klarna's IPO price shows strong demand, while Affirm's valuation remains stretched and it looks exposed to a de-rating. We see PayPal, PagSeguro,...

Klarna is due to IPO, with its valuation underwhelming relative to peers; we downgrade Affirm to a sell due to very rich valuations, and we stick...

We introduce our payments scorecard; PagSeguro and Nexi remain buys, while PayPal replaces Visa. Affirm is replaced on the sell list by Kakao Pay...