Is This Fintech Stock Discounted?

Mogo (TSX:MOGO)(NASDAQ:MOGO) stock has dropped 1% over the past three months as of close on December 9. However, the stock has climbed 20.4% in 2019 so far. At the beginning of this decade, Fintech companies posed a threat to bank and took the lead in areas like mobile banking. However, big banks have responded by pouring huge investments into their online and mobile platforms. This means that Fintech players like Mogo have had to figure out creative ways to lure consumers.

Young investors have been predictably open to change. Mogo offers a platform that includes free credit reports. It has pushed further into loan products and this has turned into an encouraging area of growth.

The company released its third quarter 2019 results on November 7. Mogo’s member base climbed 30% year-over-year to 925,000 in Q3 2019.

Total revenue rose 7.6% to $16.6 million and gross profit jumped 5% to $10.1 million. Adjusted EBITDA rose 3% from the prior year to $1.1 million.

Mogo is forecasting core revenue growth between 20-30% for its long-term operating model. It expects a decreasing adjusted net loss and expanding gross margins in Q4 2019 and the fiscal year 2020. The stock is trading at the low end of its 52-week range. The buy signal for Mogo came in early November, but it still holds potential as a long-term play even in neutral price territory.