Even though it's highly competitive, merchant acquiring and processing has been a lucrative business for companies ranging from Cielo (OTCQX:CIOXY) to Global Payments (NYSE:GPN) to U.S. Bancorp (NYSE:USB) to Worldpay (OTCPK:WPYGY). Wirecard (OTCPK:WCAGY) has been making its mark by attempting to establish itself as a leading acquirer, processor, and facilitator of global e-commerce, and the company has been reporting impressive revenue growth for some time.
(and perhaps because of) that growth, though, Wirecard has been a
Putting aside mudslinging from the cheap seats
alleging all manner of wrongdoing at the company, there are legitimate
complaints about the company's aggressive use and definitions with its
balance sheet, earnings quality, and weak cash conversion. Transparency
has improved, though, and more aggressive investors may well regard
these risk factors as part of the price paid when you invest in complex
high-growth stories. I don't necessarily see the shares as dramatically
overvalued, the premium for the growth potential here seems quite
reasonable and the bull-case scenarios lead to some appealing upside.
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Wirecard Seems Wired For Growth