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Marqeta Shares Shoot Higher On Positive Analyst View Post Q1

Analysts remained positive on Marqeta, Inc MQ post Q1 results.

Credit Suisse analyst Timothy Chiodo had an Outperform with a price target of $13.50.

Chiodo acknowledged a solid start to the year, with Q2 guided ahead of Street and FY 2022 guidance raise.

Chiodo continued to believe Marqeta as an attractive way to gain exposure to one of the most critical themes within his coverage, software platforms embedding different ecosystem- and monetization-enhancing financial services, alongside potential upside via international expansion (Europe and the Asia Pacific), new products (credit card issuing, a higher take rate business), and other call options (nascent broader BaaS [core banking technology] offerings moving MQ further into Galileo’s territory, further penetration of large FIs, M&A) as further supportive of the stock. 

Barclays’ Ramsey El-Assal had an Overweight with a price target of $19. In Q1, MQ handily beat Street estimates (and MQ’s Q1 guide) across the board. 

Though investor anxiety on the sector has weighed on MQ shares in recent weeks, a solid Q2 revenue guide and new partnership wins continue to support its Overweight rating.

Mizuho’s Dan Dolev had a Buy with a price target of $17. Dolev believes that within today’s turbulent fintech environment, MQ’s uneventful yet solid Q1 should be received as very refreshing. 

Both sales and GP showed strong growth vs. Q121 and sequentially, and MQ also provided an update to guidance for 2Q. 

Growth was driven by continued strength at Block, Inc SQ, which management noted benefited from a significant increase in the tax refund direct deposits at Cash App and Cash Card spending. 

All given metrics showed movement continuing in a positive direction, with some questions around GM% (which were clarified by management). Dolev believes 1Q results and strong medium-term growth prospects merit more investor love. 

Wells Fargo’s Jeff Cantwell had an Overweight with a price target of $13. Cantwell views Marqeta’s issuance platform as best in class, with years of outsized volume and revenue growth ahead as it executes against its sizable opportunity. 

Cantwell expects this will come from continued growth by Marqeta with disruptors and its ability to help traditional banks’ upgrade’ their card programs to better serve their customers in a rapidly evolving payments landscape. 

Cantwell forecasted strong growth in revenue and gross profit in the next two years. 

Price Action: MQ shares traded higher by 20.8% at $8.01 on the last check Thursday.

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