The Toast Inc. company logo appears during the first public exhibition of the company held on September 22, 2021 at the New York Stock Exchange in New York City.
Brendan McDermid | Reuters
Economic concerns have hit the stock market significantly, but have had a major impact on fintech companies that are closely tied to consumer spending and small businesses.
NASDAQ fell 2.1% on Thursday, pacing the high-tech heavy index in its worst week since September. Shift 4, toast and Bill.com They suffered from a steep decline, losing 6.7%, 6.2% and 4% respectively.
President Donald Trump’s disjointed developments in his trade policies, particularly the threat to tariffs that will change by that day, has rattled the market this month. Treasury Secretary Scott Bescent told CNBC’s “Street Squad Work” that the Trump administration is focusing more on the long-term health of the economy, adding that he “is not worried about a bit of instability over the course of three weeks.”
Fintech stocks tend to be more volatile than traditional banks and lenders, as investors jump on when risk tolerance is high and exit when mood is conservative. Barclays predicts that President Trump’s higher tariff policies will reduce US GDP and will raise inflation soon, leading to additional interest rate cuts this year.
Shift4, which offers payment processing technology, fell 19% this year after Thursday’s slide, nearly double the NASDAQ loss and more than three times the S&P 500’s decline.
At the same time as the revenue report, Shift4 announced it would purchase payment platform Global Blue with a share value of $1.5 billion, equivalent to about a fifth of Shift4’s current market capitalization. Analysts at DA Davidson reduced Shift4’s post-trade price target from $140 to $124, reflecting the risks of acquisition integration and financial leverage. ”
Toast, which has popular payment techniques in restaurants and cafes, has had a month of 15% down so far in March, compared to an 8% decline in NASDAQ. The company reported better results than expected in February, but inventory fell anyway.
Following last year’s doubled market capitalization and a major swing towards profitability, analyst at Piper Sandler said Toast has “a challenging job that will surpass 2024.”
The competitive fintech landscape leads to increased margin scrutiny and growth sustainability. positiveBuy now, competition for later loan products increased, dropping nearly 4% on Thursday, bringing annual stock losses to 23%.
Bill.com It provides spending and cost software to many small businesses. The company is struggling to regain its footing after a cruel profitable sale where the stock plummeted 36% with weak guidance. Stocks fell another 4% on Thursday, almost half down in 2025.
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