2 Mid-Cap Software Stocks Expected to Double in 2022, According to Wall Street

The COVID-19 pandemic has accelerated the need to adopt smart cloud-based software solutions. Moreover, businesses are investing heavily in software solutions for making their operations efficient in today’s world of cutthroat competition.

With the rising need for automation of business processes, the demand for advanced-technology integrated software solutions is increasing. This trend is expected to continue in the foreseeable future. According to Statista, revenue in the software market is expected to reach $824.85 billion by 2026, growing at a CAGR of 7.4%.

Given this backdrop, it could be wise to add mid-cap software stocks Nuvei Corporation (NVEI) and Lightspeed Commerce Inc. (LSPD) to your watchlist. Wall Street analysts expect these stocks to gain more than 110% in the upcoming months.

Nuvei Corporation (NVEI)

Based in Montreal, Canada, NVEI provides electronic payment technology solutions to merchants and partners. The company provides end-to-end processing, global gateway, checkout solution, smart routing technology, risk and chargeback management, fraud prevention tools, and a flexible merchant enrollment, underwriting, and onboarding platform. It also enables online, mobile, cryptocurrency, in-store payments. It has a market capitalization of $8.86 billion.

On January 4, 2022, NVEI announced its capacity enhancement which enables international merchants to accept local payment methods in ten Latin American countries in addition to international card schemes and alternative payment methods. This solution will support the local card schemes and alternative payment options while streamlining the setup needed to support local payment methods.

NVEI’s adjusted net income for the fiscal third quarter ended September 30, 2021, came in at $62.34 million, up 278.8% year-over-year. The company’s adjusted EBITDA increased 97.5% year-over-year to $80.94 million. Also, its EPS increased 147% year-over-year to $0.42.

Analysts expect NVEI’s EPS and revenue for fiscal 2022 to increase 21.1% and 30.6% year-over-year to $2.01 and $941.68 million. Over the three months, the stock has lost 52.5% to close yesterday’s trading session at $61.62. However, Wall Street analysts expect the stock to hit $133.56 in the near term, indicating a potential upside of 116.7%.

Lightspeed Commerce Inc. (LSPD)

Headquartered in Montreal, Canada, LSPD provides a commerce-enabling software as a Service (SaaS) platform for small and midsize businesses, retailers, restaurants, and golf course operators. The company’s SaaS platform enables customers to engage with consumers, manage operations, accept payments, and others. It has a market capitalization of $5.44 billion.

On December 8, 2021, LSPD announced that its enhanced NuORDER buying experience for Grassroots Outdoor Alliance attracted strong retailer enrolment and positive reactions from independent specialty retailers at last month’s Grassroots Connect buying show. LSPD’s solution will enable stores to conduct their businesses more efficiently.

For the fiscal second quarter ended September 30, 2021, LSPD’s revenue increased 193% year-over-year to $133.20 million. Its subscription revenue came in at $59.40 million, up 132% year-over-year. The company’s gross transaction value increased 123% year-over-year to $18.80 billion.

For fiscal 2023, LSPD’s EPS is expected to increase 27.5% year-over-year to $0.22. Its revenue for fiscal 2022 is expected to increase 140% year-over-year to $532.18 million. Over the past three months, the stock has lost 58.4% to close yesterday’s trading session at $36.61. However, Wall Street analysts expect the stock to hit $89.99 in the near term, indicating a potential upside of 145.8%.

NVEI shares were trading at $63.05 per share on Friday afternoon, up $1.43 (+2.32%). Year-to-date, NVEI has declined %, versus a -1.67% rise in the benchmark S&P 500 index during the same period.

Since he was in grade school, Dipanjan was interested in the stock market. This led to him obtaining a master’s degree in Finance and Accounting. Currently, as an investment analyst and financial journalist, Dipanjan has a strong interest in reading and analyzing emerging trends in financial markets.

More...