Square, Inc. SQ recently launched its in-app payments software development kit (SDK), which will enable developers to process payments with Square through their own mobile apps.
The in-app payments software will aid buyers in securely making payment for goods purchased online, using their credit or debit cards and digital wallets including Apple AAPL Pay and Google GOOGL Pay. Moreover, management stated that in order to deploy the new software, developers need to input only a few lines of code.
The new software can also be customized per developers’ need and will assist buyers to make seamless transactions. Notably, the new solution is expected to gain momentum with developers and sellers as it will enable them to manage online and offline payments on a single unified platform.
Coming to price performance, shares of Square have increased 60.3% over a year-over-year basis compared with the industry’s rally of 4.6%.
Square Emerges as an Omnichannel Payment Platform
Square is firing on all cylinders to expand its presence in the digital payment solutions space. The company differentiates itself by offering a comprehensive payment platform, which enables sellers to combine software, hardware and payments services from various vendors.
An omnichannel payment solution enables sellers and developers to accept payments in multiple ways through one processing company. This aids in curtailing the complexity and security of managing payments across different channels.
Per reports, omnichannel buyers spend 50% to 300% more than shoppers who use a single channel. Notably, a single unified system garners in-depth information about buying patters and enhances customer loyalty.
E-commerce Market Holds Promise
In today’s fast-moving world, e-commerce has gained immense popularity. It will continue to gain traction in the long haul with increased penetration of Internet and mobile phones. The e-commerce market has resulted in the emergence of online payment services and apps.
Per reports, revenues from this sector are expected to hit $1.7 trillion in 2018 and $2.5 trillion in 2022 at a CAGR of 9.6% between 2018 and 2022. Additionally, global e-commerce payment market is expected to generate $64.7 billion by 2025 and witness CAGR of 13.1% between 2018 and 2025.
We believe the company's strong efforts toward expansion of its payment solutions portfolio will continue to drive its top line.
Square, Inc. Price and Consensus
Square, Inc. Price and Consensus | Square, Inc. Quote
Square is vulnerable to intense competition and changing technology, industry standards and seller and buyer needs. The company faces intensifying competition from the likes of PayPal PYPL.
Notably, Venmo continues to bolster PayPal’s stake in mobile payments. This application enables the transfer of money between family and friends via mobile devices. In third-quarter 2018, the app processed $17 billion of payments, up 78% year over year.
Therefore, an omnichannel payment platform is vital to attracting customers to the platform, which should give Square an edge over its peers.
Square currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks Rank #1 (Strong Buy) stocks here.
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