Tokyo-based electronic payment company PayPay Corp (NASDAQ:PAYP) made its US stock market debut on March 12. Here are the key analyst insights:

  • Benchmark analyst Mark Palmer initiated coverage with a Buy rating and price target of $31.
  • Cantor Fitzgerald analyst Ryan Campbell began coverage with an Overweight rating and price target of $25.

Check out other analyst stock ratings.

Benchmark: PayPay was a dominant Japanese payments franchise and its public debut marks its evolution "into a full-scale financial super-app," Palmer said in his initiation note. This comes at a time when Japan's economy "is undergoing a once-in-a-generation shift away from cash," he added.

The analyst stated that PayPay is well positioned at the intersection of three "powerful secular tailwinds" of:

  • Cashless adoption
  • Embedded finance
  • Platform monetization

"With the IPO providing capital, visibility, and currency for expansion, we see PAYP entering a new phase of monetization that could drive outsized earnings growth over the next five to ten years," he further wrote.

Cantor Fitzgerald: Japan’s payments industry is undergoing a "significant structural shift," from being a cash dominant consumer economy to embracing "digital payments at scale," Campbell said. PayPay has scaled its payments business, while adding banking, credit, and investment services into the platform, he added.

While several payment companies around the world have failed to replicate WeChat's and AliPay's "super-app" model, "we believe PayPay is uniquely positioned to create a similar solution by marrying high-frequency payments with financial and commerce services," the analyst wrote.  

PAYP Price Action: Shares of PayPay had declined by 6.02% to $19.76 at the time of publication on Monday.

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