SHOP, SQ, PYPL: Digital Finance to Thrive in Trump 2.0 Administration #Finance

and joining us Jerry Snee the senior vice president and Senior private wealth adviser proon Partners uh Jerry thanks for being here this morning fun days we uh get a little bit of push back against what’s been a pretty euphoric move the last couple weeks what what stands out to you

yeah absolutely how you doing Oliver um I think it’s interesting I think like you just said it’s just a little bit of air coming out of the Markets clients were excited when when

Trump won the election I mean they were doing nothing short of shaking their couch cushions for change just to just to try and buy Assets so I just think this is a little bit of a breather I think we pick up momentum again maybe not until after the Thanksgiving holiday when

everybody’s going to be talking about Bitcoin but I think we can melt higher into year end maybe 6, 6100 on the S&P but then I’ve been I’ve been telling investors to be very cautious just because simply put we don’t know the rules of the game yet going into next year we

know what Trump Administration ran on and campaigned on but we don’t know what they’re going to attack first and I think that could Ripple through the economy in ways that people aren’t expecting so I like the momentum today just a little bit this week’s just a little bit of

air out of the tires um I think we we Trend higher from from here and then cautious for the first six months of 25 I like the point and the framing of we don’t know the rules of the game uh because there’s a lot of excitement about which sectors and which companies are going to win the

game but uh you know we still we haven’t even started playing yet we got to get uh the team in office and we’re starting to see you know people get appointed and there’s some decent Logic for all of that is there anything attached to that Trump trade that you find particularly

speculative right now not not speculative we’re trying to figure out what works regardless of what he goes after first or tries to fix first or just drop first so we’ve been we’ve been hyper focused on the payment space here at proon we think the payments companies are finally

going to have their their day in the light after a couple years of compressed multiples we particularly like Shopify reported earlier this week stock was up 30% they’re they have a lot of momentum behind them but we actually think another interesting name is block which is used to be called

Square SQ they reported last week stock was down 10% on mixed results and then rally back to be positive by the way if it was pre-election stock would have been down 20 and and probably would have stayed there so stock rally back to become positive square has three million small business merchants

in the United States they have 100% client retention of that three million that’s 15% share of small and medium-sized businesses in the United States we think they can just pick up market share going forward we know the Trump Administration is going to be focused domestically on making you

know us consumers and and companies strong we think they’re going to catch that Tailwind furthermore they lend money to those small medium-sized businesses and they have a 3% loss ratio so they know their customers so well that they can lend them money average Loans is about

$10,000 so not big Loans but it’s a 3% loss ratio put that into perspective the average in the industry is 9 to 12% loss ratio so they use a lot of customer data to lend money and it we think that’s going to grow substantially over the next uh few years on the flip side

they also have a pretty big consumer business that competes with venmo so they have 44 million monthly users of their cash app compared to venmo has got 46 million and so we think they can take that recipe for low loss rates on the lending side of the business and transport that over to the

consumer side and really compete with Credit cards so we think Square’s got all the pieces of the puzzle they just need to implement them they need to kind of get them all firing at the same uh same rate and we’re pretty bullish on them over the next 24 months great

love that fun take haven’t really heard the uh the case for uh uh block that kind of fresh in the context of some of the other Trends right now as you mention uh venmo from the peer-to-peer uh competitive standpoint is you know PayPal actually is up 40% on the year so uh and that one nobody

wanted to touch for a while so uh you know I guess that’s kind of another uh if you think that Block’s going to follow it’s only up 16% I mean PayPal was kind of like the Legacy slower uh uh version that folks are kind of doubting but I don’t know maybe there’s

something to be said about kind of being first through the door uh what do you think uh explains the gap between the two so I I think PayPal is more story around the Crypto platform they have

they’ve been kind of pushing that pretty hard people don’t realize that block is the seventh largest holder of Bitcoin yeah so I think they’re gonna I think that’s kind of like under the radar and I think they’re gonna come up you know behind PayPal I think they can

Implement better than PayPal because of the terminals that they have that are in all these small businesses so I think they have more leverage to pull to to grow Revenue in different ways versus PayPal is kind of a two- trick pony in a sense yeah well said the commercial side and

small business side huge uh for square and block good stuff nice like the stock pick thanks Jerry no problem oler good