Millennials Are Flocking To This Fintech App

In today’s market finding a company whose annual revenue matches its market cap is like finding a diamond in the rough.

In hot sectors like blockchain, cannabis and tech it’s become commonplace for pre revenue companies to have marketcaps in the billions. The Vancouver based fintech company Mogo (MOGO.Q) is that diamond in the rough as they generated $15.4 million in revenue last quarter with a market cap of $59.3M.

The Wall Street Journal currently gives Mogo   ( ) a price target of $8.65

How Mogo Makes Money

Mogo recently surpassed 700,000 members. Through Mogo’s products this member base has generated $15.4 million in revenue last quarter, these earnings were comprised of:

  • $5.7 million in subscription fees
  • $5.8 million in interest revenue
  • $3.8 million in loan fees
Mogo’s app

Mogo offers 6 main services:

Canada’s first free credit monitoring solution – knowing your credit score is the first step to being financially fit and can help you on a path to accessing the best credit rates.

MogoProtect – Digital solution designed to help protect you against identity fraud. At $8.99/month, MogoProtect is the lowest cost identity fraud solution in Canada with real time alerts notifying you of hard credit checks on your Equifax bureau through a mobile app.

MogoCard – Control your spending and set your savings goal with Canada’s first digital spending account with a free Mogo Platinum Prepaid Visa® card.

MogoCrypto – Invest in bitcoin through Canada’s first and only mobile solution that allows members to buy and sell through an app without any funding or withdrawal fees.

MogoMortgage – Buy a home and focus on getting mortgage free. Mogo is the only mortgage broker in Canada offering the ability to track your mortgage within a mobile app.

MogoMoney – Access smart credit if you need it. MogoMoney is Canada’s digital loan solution with a “Level-up” program that rewards consumers for consistent payments and Mogo is the only consumer finance company offering the ability to track your loan through a mobile app.

 

Mogo vs. Fintech Competition

If we look at other fintech players in the space and compare MOGO’s evaluation the numbers are quite favourable towards Mogo.

Company Share Price EV / Revenue
Multiple
Revenue Growth
Mogo $2.83 1.8 59%
PayPal $86.68 5.3 17.90%
Intuit $227.62 8.4 16.70%
Square $97.83 18.3 57%
Shopify $156.60 10.6 53.50%
Zillow $42.07 4.1 45.40%

 

After reviewing Mogo’s competitors from a financial aspect, it seems as though Mogo has a lot of future potential for growth. They earn a healthy amount of revenue and are still very undervalued compared to their piers.  The company also  has $130.7 million in assets, of which $30.7 million is cash, giving them room to grow and adapt to any change in the market.

The fintech sector is not a trend and is not determined whether crypto takes over banking, or on the end of the spectrum, becomes irrelevant. The partnership between finance and technology is one that makes a lot of sense and is not going anywhere, Mogo has consistently shown itself to be a consumer favourite through its positive reviews and growing user base.

 

Disclaimer: Mogo is a paid client of High Energy Trading, click here to read full disclosure.

High Energy Trading is not a licensed broker-dealer, market maker, investment advisor, or underwriter. All information that we provide is for informational purposes only and should not be construed as an offer or solicitation of an offer to buy or sell securities.

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