PAX Global Remains Well-Leveraged To Double-Digit Growth In Cashless Transactions

Credit where it’s due – PAX Global Technology (OTCPK:PXGYF) (327.HK) management has done a very good job over the past couple of years in pivoting the business toward better growth opportunities in merchant point-of-sale (or POS) terminals, particularly its Android terminals, and deemphasizing markets like China where competition is just too fierce to make attractive returns. Moreover, some of the company’s fiercest competitors, including Verifone and Ingenico have chosen to deemphasize hardware in many of the markets PAX targets.

With that, these shares have appreciated more than 100% since the time of my last article, handily beating its comp group, though not keeping pace with Square (SQ) or PayPal (PYPL) over that time period.

There are plenty of issues for investors to consider before investing in PAX Global. Management’s disclosures have gotten better, but investors expecting transparency on par with U.S.-listed companies are likely to be disappointed. What’s more, while these shares have decent liquidity, investors may find the Hong Kong-listed shares more attractive.

I do continue to see an elevated risk profile here, but with mid-single-digit revenue growth and a double-digit discount rate still supporting a double-digit long-term total annualized expected return, it’s hard not to still lean favorably toward these shares.

 

Read the full article here: 

PAX Global Remains Well-Leveraged To Double-Digit Growth In Cashless Transactions