Digital payment giant PayPal has regained market recognition.

Recently, Wolfe Research, a well-known research firm in the field of financial analysis, upgraded PayPal Holdings Inc. (hereinafter referred to as "PayPal")'s stock rating was upgraded from "Peer Perform" to "Outperform" and a target price of US$107 has been set.This rating change is based on positive expectations for PayPal's future growth potential, particularly in areas such as brand checkout innovation, Braintree value-by-value pricing and Venmo monetization.

After the announcement, PayPal's share price received another boost. The stock reached 1.6% in night trading to US$90.79 and has risen about 48% so far this year.

Three reasons why PayPal is growing

Analysts are optimistic about PayPal for three main reasons.

First, PayPal aims to expand its reach in the consumer e-commerce checkout space through branded checkout innovations such as the Fastlane solution, targeting 60% of the non-button connectivity market.This innovative solution is expected to attract new merchants and consumers to join the PayPal ecosystem, increasing transaction volume and market share.

Second, PayPal aims to drive the growth of users using PayPal offline by launching PayPal Everywhere, a new debit card service that offers customized rewards and a 5% cash back.This move will not only expand PayPal's presence in the physical retail environment, but also create new revenue streams and enhance customer loyalty.

Third, Venmo, as PayPal's peer-to-peer payment platform, also presents a significant opportunity to increase PayPal's revenue.Venmo is actively monetizing by expanding its debit card services and promoting merchant transactions that "pay with Venmo".Data shows that Venmo's monthly active users and the adoption rate of the "Pay with Venmo" service have increased significantly.

Data shows that although PayPal's business is closely related to consumer spending and e-commerce activity, putting it at risk during a recession or a significant economic slowdown, PayPal has shown resilience to macroeconomic challenges through strategies to optimize its user base and ensure an active user experience.In addition, PayPal has maintained its competitive advantage in the fierce competition in the digital payment market by acquiring start-ups and innovative companies to attract talent.

Analysts said PayPal Holdings 'stock rating upgrade and target price setting were based on optimistic expectations of its future growth potential.As PayPal advances its strategy in brand checkout, offline payments and Venmo monetization, the company is expected to achieve higher transaction volume and revenue growth in the future.

How to grasp the explosive growth of digital payments?

In recent years, digital payments have experienced explosive growth.Especially after the epidemic, more and more people are switching to contactless payments to reduce the risk of infection.

A MasterCard study showed that 79% of consumers around the world choose contactless payments to reduce the risk of infection.The study also found that 46% of cardholders have shifted their payment methods from traditional credit cards to contactless options such as mobile payments, digital wallets and online banking.Consumers have also said they will continue to use these payment methods even if the epidemic ends.

Forture even said that the global digital payment industry will continue to experience outbreaks in the next three years, with a total scale expected to reach US$17,643.35 billion by 2027, with a compound annual growth rate of 23.7%.

Whether it is the accelerated development of the entire industry or the prosperity of PayPal, it has brought many opportunities to investors.So, as an individual investor, how should we grasp the dividends of the digital payment era?Buying an ETF may be a safer choice.

On the one hand, due to the advantage of ETF's "even rain and dew", investors can avoid the trouble of stock selection,"package" all the stocks within the concept, and receive dividends from a basket of stocks.On the other hand, the selling price of ETFs is also cheaper than buying individual stocks alone, which can also greatly lower the threshold for investing and participating in the digital payment market, and is relatively friendly to investors.

Moreover, ETFs do not face the risk of suspension or delisting.ETFs may fall sharply along with the industry or the broader market, but they will not be violent, so they can keep trading going normally in extreme bear markets, giving investors the opportunity to stop losses and exit.

The following are some of the more representative electronic payment ETFs & indexes on the market. They are not recommended for investment but are for reference only.

At the same time, Hawk Insight provides you with a summary of the major participants in the digital payment market (ranking in no particular order), allowing you to track the latest market information:

Alipay Limited (Hangzhou, China)

Adyen (Amsterdam, Netherlands)

American Express Company (New York, USA)

ACI Worldwide Inc. (Florida, USA)

JPMorgan Chase & Company (New York, USA)

Facebook Inc. (California, USA)

MasterCard Company (New York, USA)

Apple Inc. (New York, USA)

Amazon (Washington, USA)

PayPal, Inc. (California, USA)

Visa, Inc. (California, USA)