Times are tough right now, but the U.S. consumer is feeling a bit better this month with the U.S. Index of Consumer Sentiment hitting its highest point since last April. Add in news on Wednesday that e-commerce firm Shopify (SHOP) would up prices for its plans and an analyst’s assessment that the firm has dry powder for M&A, and there may be a solid case for investors to track an active fintech ETF like the ARK Fintech Innovation ETF (ARKF).
SHOP was up 8.7% at press time Wednesday and was already up nearly 39% over the last month. The Canadian company, which received an upgrade from Deutsche Bank this week, announced the 34% seller fee hike in a blog post. That price hike may also raise the growth floor for the company, too, which could be a key booster in a year that looks to be a bit volatile.
Meanwhile, at least one analyst believes the firm’s cash flow and financial flexibility position it to make more buys to support its strategy. That could help in a year in which competitors may struggle due to rising rates or a possible recession, allowing SHOP to cement itself as a preeminent e-commerce platform.
ARKF currently has SHOP listed as its highest-weighted stock at 11.8%. The active fintech ETF charges a 75 basis point fee currently, and invests in firms positioned to win in the financial technology space focused on the blockchain, transaction innovation, customer platforms, and more. ARKF recently turned around one-month net outflows into net inflows over the last five days, adding $11.5 million in that time.
ARKF does not just benefit from SHOP, but also its exposure to the ongoing crypto spring via Coinbase (COIN), its third-largest holding at 10%. The active fintech ETF also holds fellow transaction company Block (SQ) as its second-largest weighted stock at 11.7%.
Investors have a lot on their plates right now, with earnings week in full swing. That said, customers will still be spending, and SHOP could be one stock positioned to grow its market share this year if its M&A capacity strength produces results. For investors interested in the space, ARKF is certainly an ETF to consider.
For more news, information, and analysis, visit the Disruptive Technology Channel.