Not all of the shares listed on the stock exchange were launched. Fintech card issuer Marqueta (NASDAQ: MQ) went public in June as a vastly outdated first that has continued to fizzle out, losing 45% of its value since then.

The drop in prices is curious, given the investment community’s love for FinTech and Marqeta’s strong performance. Due to its performance, this stock remains under Wall Street’s radar, but with its solid opportunities and efficient business execution, it could be a surprise growth choice for 2022.

A solid and relevant fintech

Marqeta CEO Jason Gardner started the company in 2009 as the concept of fintech gained momentum. Older credit card platforms did not support technological innovations, and he felt he could start an easy-to-use, agile, and customizable system to activate an array of credit card functions – and Marqeta is not.

Marqeta is a technology-driven credit card infrastructure platform offering customizable credit card solutions. It works through an API plugin, so customers can integrate it into their systems and connect to the Marqeta network seamlessly. The platform manages contacts with the processing network, such as Visa and the issuing bank, for quick and easy transactions.

This model targets corporate customers, who may have different credit card needs than standard bank credit cards. Some of the end users are employees, while others are customers. Some of his clients include To block (formerly Carré), Affirm holdings, and Uber. Some of the features it offers include instant payments and employee expense cards with default expense controls, which is important for companies like Uber, whose drivers need to be able to pay for orders quickly. Another example is AlphabetGoogle Pay’s, which partners with Marqeta to power a tokenized virtual card for users to spend Google Pay balances with.

Why did Marqeta get hammered in 2021?

For the two quarters (ending June 30 and September 30) that Marqeta posted earnings as a public company, it turned out pretty well for itself.

Data source: Marqeta quarterly reports.

In both quarters, revenue growth exceeded analysts’ expectations. Another important metric, the total volume of payments, has grown at rates similar to income. The loss per share is well below average analysts’ expectations of $ 0.07 in the second quarter, but it exceeded expectations of $ 0.14 per share in the third quarter.

So why all the negativity in stock prices? On the one hand, losses accumulate and the valuation of the company is high. It is quite common for losses to accumulate as new businesses develop; the focus is more on expansion than on profit generation. But investors like to see losses decrease over time, not increase, which they did in the second and third quarters. As for valuation, stocks are trading at a high price 19 times the sales, even at a lowered price. Even if it is increasing at a reasonable rate, income is still low and may not support the current valuation. Finally, fintech as an industry has not performed well lately as the omicron variant of the coronavirus is taking its turn and parts of the country have put new restrictions in place.

Where will Marqeta go in 2022?

Marqeta recently announced some exciting developments. It has several partnerships with cryptocurrency companies and offers the right technology to advance the vision of crypto. For example, it feeds a card with Global Coinbase which allows crypto wallet holders to use their balances for retail payments. He also recently made an agreement with Bill.com which provides enterprise-level services to small and medium-sized businesses through its infrastructure. It also has international opportunities, and the number of European customers doubled year over year in the third quarter.

The real surprise is that Marqeta hasn’t thrilled investors so far. Management defines its addressable market of “modern card issuance” at a gargantuan $ 30 trillion, and while its focus is somewhat different, its services may lessen the grip that executives such as Visa and American Express have on credit card solutions. She can also work with them, like her partnership with MasterCard to support its “buy now, pay later” platform. Gardner states that “Marqeta can outperform new entrants in this market and outperform existing platforms.”

Marqeta is still a risky stock to own for the reasons mentioned above – high valuation, unprofitable, and in the midst of a global pandemic. But the future looks very bright, and as it grows and becomes more stable, it could be a huge winner in 2022.