E What The Latest Conference Call Says About Wirecard's Efforts In The Payments Space

Payments processing is big business and – as is often the case in industries of this size – it's dominated by a few large names in the US. In this instance, companies like PayPal, Visa Inc (V) and, increasingly, Stripe, control large portions of the market.

Outside of the US, however, things are a little more fragmented. The industry is still dominated by a number of big names, but smaller (and when I say smaller here, I still mean multi-billion dollar market capitalization) entities are drawing market share from their incumbent peers. Primarily, this is driven by the speed of innovation and an adaptability that the larger players are unable to accommodate.

I believe these 'smaller' players have the potential to make rewarding exposures over the coming decade as they revalue to reflect their increased market share.

Wirecard AG (FRA:WDI)(WRCDF) is a company in the digital payments space, with assets including online payments, mobile payments, and point of sale systems. The company offers a comprehensive lineup of payment services for businesses, primarily in the European market (but expanding internationally). Its service offerings include payment systems, card issuing, risk management technologies, customer services and loyalty programs.

I think this company is one of the best representations of the above-outlined thesis.

Earlier this month, Wirecard held an earnings conference call for its Q1 results. Alongside the primary numbers, executives (as is generally customary) gave some indication of where the company is focusing its resources in its efforts to achieve growth.

Here's a look at some of the key points from the call and how they play into my thesis on the stock.

The main speaker in the conference call was Marcus Braun, the company’s CEO, CTO, and a member of the management board. In his section of the call, he highlighted several financial metrics the company attained in that quarter. A main point of emphasis in the presentation was digitization. As most readers will be aware, digital payments are increasingly dominating financial transactions worldwide. Wirecard aims to be a leader in the growing digital payments space, offering a wide range of digital payment options.

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Disclosure: I have no commercial relationship with any of the companies mentioned in this article and I don't have an active position in any of these companies' stock, nor any intention to ...

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Bonette Fitch 3 years ago Member's comment

This article tells about the effort of Wirecard in gaining more users just like other giant processing systems like Paypal. However, it seems that it still needs more time and innovation to get ahead or even equate its giant competitors. Wirecard’s management appears to be dedicated into making the company reach further heights. With the increase of digital payment system, more and more payment processing companies will rise in the near future. Existing companies like Wirecard should create new and more effective marketing and operational strategy to increase or at lease maintain its flow of revenues. It is interesting to know more about the progress of this company. Those who use this payment system as well are those who are planning to use this will also find the report very insightful.