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The Zacks Analyst Blog Highlights: Alphabet, Apple, Amazon, PayPal and Facebook

Zacks Equity Research

For Immediate Release

Chicago, IL – November 15, 2019 – Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include: Alphabet GOOGL, Apple AAPL, Amazon AMZN, PayPal PYPL and Facebook FB.

Here are highlights from Thursday’s Analyst Blog:

Facebook Pay Takes the Digital Payment Game a Notch Higher

Increasing use of smartphones and Internet has resulted in growth of payments apps. Moreover, change in consumer behavior, particularly increasing adoption of ecommerce, is playing a crucial role in driving digital payments volume. Additionally, growing demand for mobile Point-of-Sale (POS) and peer-to-peer payments are benefiting the space.

Further, adoption of smart speakers and wearables like smartwatch, which can be synchronized with payment apps, is driving the demand for online payment solutions.

Per a report from Mordor Intelligence, the global digital payment market is expected to reach $7.6 trillion by 2024 at a CAGR of 13.7% between 2019 and 2024.

Further, a Statista report shows that the total transaction value in this particular space is projected at $4.1 trillion for 2019. The same is anticipated to hit $6.7 trillion by 2023 at a CAGR of 12.8% over a period of 2019-2023.

Tech giants like Alphabet’s Google division, Apple and Amazon are trying to capitalize on the prospects of the space, which is currently dominated by PayPal.

In fact, social-media giant, Facebook, has also joined the bandwagon recently. The company introduced its new payment service, Facebook Pay, which will allow users to make payments and send money to others. This initiative is likely to intensify the competition in this space further.

Facebook Under Spotlight

Facebook Pay intends to provide secure and convenient online payment experience to users. The payment solution allows users to view their payment history and manage payment methods. Further, the company will provide real-time customer support via live chat.

Notably, the latest app will be made available on Facebook and Messenger apps this week and will be rolled out on Instagram and WhatsApp eventually. These four apps form the “Family” of services provided by Facebook. Notably, more than 2.2 billion people use these services every day on average. Further, almost 2.8 billion people use at least one of these services on a monthly basis.

Facebook Pay is likely to gain traction in the digital payment market backed by the company’s strong user base.

Further, this Zacks Rank #3 (Hold) company is constantly investing in security technologies by infusing AI and ML to address data privacy issues. We note that Facebook Pay stores bank account and card details securely and performs anti-fraud monitoring.

However, the company’s checkered history related to protection of user data is a major headwind related to the adoption of Facebook Pay.

Should PayPal Take Note?

Facebook’s move is likely to threaten the position of PayPal, which currently enjoys a dominant position in the digital payment space.

PayPal enjoys solid momentum in peer-to-peer transfer on the back of its well-performing Venmo, which enables transfer of money between family and friends via mobile devices. The company is constantly adding new features to this app in order to make it more user friendly.

Further, the company’s partnership with MasterCard will continue to aid the adoption rate of Venmo. Notably, the Venmo app processed more than $27 billion in third-quarter 2019, up 64% year over year.

Notably, PayPal carries a Zacks Rank #4 (Sell).

How Google, Apple & Amazon are Faring?

Google offers peer-to-peer payment service and reward system through Google Pay, which is driving momentum in the digital payment space.

Further, the search giant is making strong efforts to strengthen its presence in this space. Following the launch of Facebook Pay, the company announced that it will offer personal checking accounts via Google Pay next year onwards.

Additionally, this Zacks Rank #3 company announced an integration with PayPal by which Google Pay users can access their PayPal account as a check-out option. This will enable Google Pay users to switch between their saved payments methods, now including PayPal, apart from debit and credit cards and other options.

Meanwhile, Apple is well poised to gain on the back of its well-performing digital wallet called Apple Pay. Further, the easy synchronization of Apple Pay with Apple Watch remains a major positive.

Apple Pay’s transaction volume stood at 3 billion in fourth-quarter fiscal 2019. The figure more than doubled year over year. Further, the app is now available in 49 markets and has more than 6K users.

Notably, Apple carries a Zacks Rank #3. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Meanwhile, Amazon is gaining traction on the back of its online payments processing service — Amazon Pay. The app allows users to make payments, perform shopping, pay bills, book flight and event tickets.

Further, the company’s strong cashback offerings and huge customer base of its e-commerce platform is boosting the adoption rate of Amazon Pay. Amazon currently carries a Zacks Rank #3.

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Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit https://www.zacks.com/performance for information about the performance numbers displayed in this press release.

Click to get this free report Amazon.com, Inc. (AMZN) : Free Stock Analysis Report Facebook, Inc. (FB) : Free Stock Analysis Report Alphabet Inc. (GOOGL) : Free Stock Analysis Report PayPal Holdings, Inc. (PYPL) : Free Stock Analysis Report Apple Inc. (AAPL) : Free Stock Analysis Report To read this article on Zacks.com click here. Zacks Investment Research