NVEI:CC - Is Nuvei Stock a Millionaire Maker?
2024-01-12 20:45:00 ET
What does it take for a stock to be a millionaire maker? An early investment into a technology that could touch your everyday life without you realizing its existence. We often talk about stocks that could have made you a millionaire had you invested in them in their early growth stage.
Constellation Software is a stock that made its loyal shareholders a millionaire. Anyone who invested $10,000 in this stock in December 2009, when it traded just over $36, now has $950,000, just $50,000 short of a million. The stock trades at $3,486 per share today and continues to generate over a 25% average annual return. Now, you can’t go back to the past and buy shares of Constellation. But one thing you can do is look for another millionaire maker in the making.
Can Nuvei stock make you a millionaire?
To convert $10,000 into $1 million, you need a stock that can grow 10,000%. For such high returns to be sustainable, they need time and patience. Nuvei ( TSX:NVEI ) is a relatively new tech stock that started trading on the TSX in the midst of the 2020 tech bubble when tech stock prices were inflated. Therefore, don’t judge this stock by its 28% dip from its initial trading price.
Nuvei is a payments platform provider that has the potential to grow significantly with wider adoption. The platform helps companies accept next-gen payments from more than 200 markets in 150 currencies and 600 alternative payment methods. The company also offers card issuing, banking, and risk and fraud management services. It offers a full stack of payment solutions a business would need.
The Nuvei platform is available to all merchants, big and small, offering financial services, digital products, gaming, e-commerce, and retail. Nuvei is scaling its operations to large enterprises by converging its payments platform to companies’ enterprise resource planning (ERP) software. It is acquiring tech companies to expand its geographical outreach and tech solutions. Companies like Microsoft are using Nuvei to collect payments in specific markets.
Looking at the pace at which Nuvei has grown its business in the last three years, it seems like it is on the road to becoming a millionaire maker once the dice gets rolling. However, the company’s growth is facing many challenges that have pulled down its stock price.
Why did Nuvei stock fall?
Nuvei’s stock faced a challenge from a short-seller Spruce Point Capital. The short-seller made personal attacks on Nuvei’s management to shake investors’ confidence and pull the share price down. Many fundamental analysts noted that the short-seller’s allegations were inaccurate and without solid footing. They continued to remain bullish on Nuvei’s business model and strategy.
Nuvei stock fell 84% because of this short-selling episode combined with the 2022 tech bubble burst. To add to the trouble Nuvei’s synergies from the Paya acquisition are slow to uptake as a global economic slowdown reduces commerce activities. It has created an opportunity for value seekers to buy stocks they see potential in for the long term.
How to invest in this stock to become a millionaire
You can buy the stock at the current price even though it has surged 71% from its October 2023 low. Even if you don’t have $10,000, you can invest in installments of $1,000 over one or two years. As the stock will take some time to gather momentum, you can take this time to accumulate more shares and reduce your average cost per share.
Nuvei is a stock to hold for 10 to 15 years in your Tax-Free Savings Account (TFSA) to keep your capital gains tax-free. Don’t be disheartened if the first three years give you low returns. Early-stage growth stocks tend to have volatile short-term returns.
The post Is Nuvei Stock a Millionaire Maker? appeared first on The Motley Fool Canada .
The Motley Fool has positions in and recommends Nuvei. The Motley Fool recommends Constellation Software. The Motley Fool has a disclosure policy . Fool contributor Puja Tayal has no position in any of the stocks mentioned.
2024