But might this just be a chance to invest in this fast-growing fintech at a marked-down price? Here are my thoughts.

‘Sell first, ask questions later’

As a quick reminder, Wise transfers money across borders more quickly and cheaply than traditional banking methods.

Indeed, it bypasses these networks entirely by operating a massive global network of local bank accounts. The firm calculates the mid-market exchange rate and applies a small and transparent fee, which it continually lowers as it grows larger.

In recent years, Wise has had great success attracting customers, including businesses and large financial institutions. It now has over 19m active customers worldwide and processes roughly 4.7m transactions per day.

The danger with such increasing scale, of course, is that criminals can try to move laundered money. Fintechs including Monzo, Starling Bank, and crypto exchange Coinbase have all faced fines for compliance failures in the past couple of years.

Like every financial institution, we face the reality of increasingly sophisticated bad actors attempting to exploit our platform, and we continually invest in tech-enabled systems and teams to stay ahead of ever-evolving threats.
Wise.

Today, the stock fell after the company said it’s responding to enquiries from prosecutors in Brussels relating to Wise accounts being used for criminal activity (suspected drug-trafficking and corruption).

The suspicious transactions are reportedly said to involve around €500m across European countries. For context, Wise did £181.7bn in global cross-border volume last year (25% growth).

Predictably, investors are responding with the age-old approach: sell first, ask questions later. Actually, these days it’s more likely trading algorithms programmed to respond this way.

Where next?

Wise says no specific findings have been shared with the company, while the requests themselves are not evidence of non-compliance or wrongdoing.

However, the timing is awkward because the company has only just moved its primary listing to the Nasdaq. These headlines could dampen enthusiasm for the shares and hinder customer acquisition across the pond.

On top of this, the firm might feel the need to beef up its checks for new customers. That could introduce friction in the onboarding process, slowing growth.

It’s worth noting that about a third of Wise’s global team is dedicated to compliance and anti-financial crime. So this is disappointing news, and is likely to increase volatility in the share price moving forward.

Bargain?

But might Wise stock be a bargain around 805p? Potentially, if this investigation leads nowhere. The slump puts the stock on a forward price-to-earnings ratio of about 21, which isn’t particularly high for a fast-growing fintech.

Wise aims to move trillions in future, and has barely scratched the surface of its opportunity in the large business segment. So today could prove to be a very attractive entry point, even if Wise achieves half its potential. But the ongoing investigation obviously adds risk.

As for me, I won’t be buying any more shares because this is already quite a large position for me. But today’s fall illustrates how important it is to have a diversified portfolio of stocks.

Should you invest £5,000 in Wise Plc right now?

When investing expert Mark Rogers and his team have a stock tip, it can pay to listen. After all, the flagship Twelfth Magpie Share Advisor newsletter he has run for nearly a decade has provided thousands of paying members with top stock recommendations from the UK and US markets.

And right now, Mark thinks there are 6 standout stocks that investors should consider buying. Want to see if Wise Plc made the list?

Ben McPoland owns shares of Wise.

The post After crashing 13.7% today, is Wise now a stock market bargain at 805p? appeared first on The Twelfth Magpie.

But there are some growth shares in the UK market that I think have a lot of the characteristics seen in some of the more exciting US stocks.

UK fintech with global ambitions

One is Wise Group (LSE: WISE), the UK-based fintech that facilitates money transfers internationally.

Its share price has actually fallen 16% in the past year. Indeed, concerns about whether the company can fully unlock its potential on the London market help explain why it obtained a secondary share listing Stateside this month.

That share performance reflects concerns some investors have about Wise’s long-term model. It is building its business in part by offering keen pricing, a risk for profitability.

That was reflected in the results it issued at the halfway point of its current financial year. Revenues grew 11% year on year, but underlying profit before tax fell 17%.

I think Wise is on the right track

That profit number is not going in the right direction.

But Wise’s revenue growth is impressive, as is the upwards march in user numbers. They reached a record number in the most recent quarter, with the company reporting 11.3m active customers.

I think the strategy of focussing on scaling up now makes sense. That can help lay the foundation for longer-term success for the group thanks to a large entrenched user base, strong brand, and economies of scale.

This is not some startup company throwing huge sums of money down the drain. Wise is solidly profitable: although profit in the first half fell 14% year on year, it still came in at £187m.

The company expects its pre-tax profit margin for the year to be at the top end of the 13%-16% range it has indicated.

Could this be a long-term bargain?

International exchange is a business that rewards scale.

The more customers Wise serves across a wide variety of currencies, the easier it will be for it to match a buyer on one side with a seller on the other at a competitive price.

But Wise’s investment case is about more than currency exchange. Customers building up deposits with it and being paid lower interest than Wise can earn by putting the same money to use could ultimately be the real profit driver for the company, just as it is at many banks.

The company ended its most recent quarter with a record £23bn of customer balances. Marketing campaigns promoting this deposit part of Wise’s offering could mean that that number grows steadily in coming months and years.

We await Wise’s full-year results for its most recent 12-month trading period that ended in March. But based on the prior year’s earnings, the growth share sells for around 22 times earnings.

That is not cheap, but I see substantial long-term growth potential for the business.

From a long-term perspective, I regard the current share price as attractive and think investors should consider Wise.

Should you invest £5,000 in Wise Plc right now?

When investing expert Mark Rogers and his team have a stock tip, it can pay to listen. After all, the flagship Twelfth Magpie Share Advisor newsletter he has run for nearly a decade has provided thousands of paying members with top stock recommendations from the UK and US markets.

And right now, Mark thinks there are 6 standout stocks that investors should consider buying. Want to see if Wise Plc made the list?

Christopher Ruane does not hold any position in the companies mentioned.

The post Down 16% in a year, is this UK growth share now a bargain? appeared first on The Twelfth Magpie.

Source: Hedge Fund Tips

That might bring about a downturn in share prices. But investors who are prepared probably don’t need to worry too much.

Where to find inflation protection?

Inflation has reached 3.8% in the US (though the UK situation is much more positive). And investors have a few ways of responding.

Source: Trading Economics

One strategy is to try hedging. This involves buying something that’s likely to go up in price if inflation keeps going strong. 

The classic example is actually outside the stock market. Inflation tends to lead to lower bond prices as the real value of fixed returns falls.

As a result, one strategy is to go short something like the 20-year US government bond. And there are a few ways to do this. 

One is via options on the iShares 20+ Year Treasury Bond ETF. That’s something a professional fund manager might look at.

The downside to this is that it’s complicated. And for ordinary investors, I think there are much more straightforward alternatives. 

Strategies for ordinary investors

Institutional investing is different to retail investing. And ordinary investors have a huge advantage in a stock market crash.

With professional fund managers, their clients start looking elsewhere if they have a bad three months. This doesn’t happen to ordinary investors.

The result is that most people don’t need to hedge their portfolios the way professionals do. If stocks go down, they can just sit and wait.

According to Warren Buffett, the stock market transfers wealth from the impatient to the patient. And this gives retail investors a big advantage.

The trouble is, they risk throwing this away by doing things professionals do. In doing so, they turn opportunities into challenges.

It’s unwise, though, to ignore the threat of a stock market crash entirely. So what should ordinary investors do instead? 

Which businesses are helped by inflation?

Investors need to think about what inflation means for their investments. But that means the underlying businesses, not just share prices. 

Some businesses are more resistant to inflation than others. Cross-border payment platform Wise (LSE:WISE) is one example. 

Higher prices mean higher transaction volumes. And since Wise makes money by taking a fixed percentage of these, its revenues naturally increase.

That works to a point. If inflation gets out of control and spending dries up entirely, the effect could be lower payment volumes.

The firm also has another defence against inflation – its scale. More users and more payments bring down the cost of any single transaction.

Wise looks to use this advantage to charge customers lower prices. That makes it hard to compete with, especially in an inflationary environment.

Buying and holding

Wise is a really interesting business. And the stock is unusually cheap at the moment.

The firm recently moved its main listing to the US. The ambition was to attract more investors. So far, that hasn’t been an obvious success. The stock is down 14.5% since joining the Nasdaq.

That, however, could be an opportunity. In today’s market, I think it’s well worth checking out.

Should you invest £5,000 in Wise Plc right now?

When investing expert Mark Rogers and his team have a stock tip, it can pay to listen. After all, the flagship Twelfth Magpie Share Advisor newsletter he has run for nearly a decade has provided thousands of paying members with top stock recommendations from the UK and US markets.

And right now, Mark thinks there are 6 standout stocks that investors should consider buying. Want to see if Wise Plc made the list?

Stephen Wright has no position in any of the companies mentioned.

The post Is inflation about to cause a stock market crash? appeared first on The Twelfth Magpie.

Here are three stocks that I reckon are worth considering for a SIPP for at least the next five years.

Latin America

Let’s start with Nu Holdings (NYSE:NU), which is the leading digital bank in Latin America. In Q1, the firm added another 4m customers, bringing the total to over 135m.

Most of those are in Brazil, but the profitable lender is also growing rapidly in Mexico and Colombia. All three countries still have low penetration rates when it comes to financial services, indicating that this is a growing market.

However, Nu’s share of the existing monetisation pie is still small. In Brazil, for example, the annual total industry gross profit pool today is about $100bn. The digital bank has about 7% of that, and just 1% of Mexico’s $43bn.

One near-term concern here is rising household debt in Brazil, which has spooked the market. However, employment remains high overall and there’s a massive government-backed programme to help people reduce and restructure debt.

After losing 32% of its value inside five months, the stock looks enticing from a long-term perspective. It’s trading at about 15 times next year’s forecast earnings, which is cheap for a company that has a very large opportunity ahead.

Income and growth in Asia

Turning to Asia now, I want to flag Schroder Oriental Income Fund (LSE:SOI). Its purpose is “to tap into the Asian income story and help investors diversify their dividends“.

However, beyond income, the investment trust also targets capital growth. It has found great success here recently with top holdings Taiwan Semiconductor (TSMC) and Samsung Electronics. These stocks are up 121% and 395% respectively in the past year, driven by massive global investment in artificial intelligence (AI) infrastructure.

This pair of leading semiconductor foundries have helped the Schroder Oriental Income share price jump 51% in the past 12 months. And this has boosted the annualised 10-year return to around 12.5%, which is comfortably ahead of the benchmark (MSCI AC Pacific Ex Japan Index).

Despite this surge, the trust’s still trading at a near-6% discount to net asset value (NAV), while also offering a 3% dividend yield. I think this offers solid value, albeit the stock could sell off if investors sour on AI and its top two holdings.

Big US growth opportunity

Finally, I reckon international money transfer specialist Wise (LSE:WISE) deserves a closer look after falling 16% in a month.

The firm has moved its primary listing to the US, where it estimates Americans will lose $43bn this year in hidden cross-border fees. As such, it sees a massive opportunity to sign up millions of customers to save them money, including thousands of banks.

Last year, cross-border volume rose 25% to £181.7bn. However, the firm sees a longer-term opportunity to move trillions, with the US being a key pillar of this strategy.

Looking ahead, Wise could face potential regulatory hurdles in the US (it wants to settle US dollar payments directly with the Federal Reserve).

But at 23 times forward earnings, I think the stock looks attractive given the disruptive growth potential.

Should you invest £5,000 in Wise Plc right now?

When investing expert Mark Rogers and his team have a stock tip, it can pay to listen. After all, the flagship Twelfth Magpie Share Advisor newsletter he has run for nearly a decade has provided thousands of paying members with top stock recommendations from the UK and US markets.

And right now, Mark thinks there are 6 standout stocks that investors should consider buying. Want to see if Wise Plc made the list?

Ben McPoland has positions in Nu Holdings, TSMC, and Wise.

The post 3 top stocks to inject strong international growth into a SIPP appeared first on The Twelfth Magpie.

However, the UKs home to some cracking, lesser-known growth companies. Here are two I think deserve a closer look today.

Wise

Let’s start with the largest, Wise (LSE:WISE). The international money transfer specialist has a £10.8bn market-cap, but rather than try join the FTSE 100, it’s moving its primary listing to the US.

However, it will keep a secondary listing in London, where each share currently costs 1,050p. This puts the stock on a forward price-to-earnings (P/E) ratio of 26.5.

I don’t think that’s outrageous for a company that did the following last year:

• Grew underlying income 19% on a constant currency basis to £1,619m.
• Increased cross-border volume 25% to £181.7bn.
• Grew customers 21% to 18.9m.
• Guided for pre-tax profit margin to be towards 16%.

Looking ahead, the growth engine still seems very strong to me. As well as people, more businesses are signing up to use Wise, whose infrastructure makes cross-border transactions cheaper and faster. Some 75% of transfers are now instant.

Plus, Wise is lowering the take rate as it scales. While some investors might not like this because it’s sacrificing short-term profitability, it should place Wise in a much stronger competitive position over the long run.

And as a long-term investor, that’s what I’m interested in.

However, in the near term, the situation in the Middle East represents a risk to growth. If soaring inflation and energy costs tip the global economy into a downturn, then it’s possible less people and businesses will move money around.

Despite this risk, I’m happy to have Wise as a top-10 position in my portfolio. The stock’s up 21.5% year to date, but I still think it’s worth considering anywhere near £10.

Boku

Turning to Boku (LSE:BOKU) now, this is a much smaller company, with a £525m market-cap. Despite its modest size, Boku works with the world’s largest merchants, helping them drive sales in more than 60 countries through local payment methods (LPMs).

For example, let’s say someone in Thailand wants to subscribe to Netflix. They select their digital wallet as the payment method, and Boku provides the backend piping that connects Netflix with that specific local wallet. Its network now reaches 200+ LPMs, and is growing every year.

Last year, revenue jumped 30% to £129m, up from £62m in 2021. By 2028, analysts expect that to reach more than £210m, with LPMs expected to account for 60% of the $11trn global e-commerce market.

However, Boku isn’t a loss-making fintech. Its profits are growing alongside strong top-line expansion, and management’s confident margins will improve in future years.

The good news is that this earnings growth doesn’t look priced in, with the stock trading at just 18 times next year’s forecast earnings. That’s cheap for a scalable platform that expects to continue growing at 20% over the medium term.

Again, a global economic downturn is a risk, as is competition in the payments space. But I reckon this under-the-radar stock’s worth considering buying for the next five years.

The post 2 top growth shares to consider on the London Stock Exchange appeared first on The Twelfth Magpie.

But what if a saver had instead put 10 grand into the stock market a decade ago? What sort of return would they have now? Let’s find out.

Chalk and cheese

According to The Investment Association (IA), a £10,000 sum put inside a Cash ISA a decade would now be worth roughly £8,400 in real terms. This is due to inflation, which erodes purchasing power, as I’m sure we’re all aware today.

However, 10 grand invested in a global index fund a decade ago would today be worth about £19,700 in real terms. So basically a doubling.

While there’s no guarantee this return will be replicated moving forward, it shows how the stock market significantly outperforms cash over the long run. And that’s information worth taking seriously, especially when UK inflation remains frustratingly stubborn.

Active investing

A global tracker fund is essentially a giant bucket that holds a small slice of nearly every major listed company in the world. But for investors willing to take on more risk, buying individual shares can be even more lucrative.

Consider the five-year price returns of these popular UK stocks:

• Rolls-Royce: +1,009%
• Shell: +156%
• Lloyds: +128%
• Tesco: +121%
• BAE Systems: +312%

Note, these returns don’t include dividends!

As mentioned, stock picking is riskier because unexpected things can go wrong at companies. For example, an accounting error at WH Smith last summer sent its share price crashing 42% in one day!

To offset this risk, it’s important not to go all-in on a small number of shares. Diversification is a cornerstone of portfolio construction.

Wise

Which UK stock do I think could produce strong returns over the next decade? Wise (LSE:WISE) is one that I own in my SIPP and Stocks and Shares ISA.

The company helps people and businesses transfer money internationally, both quickly and cheaply. Back in the day, this tended to cost an arm and a leg due to the myriad hidden bank charges and mark-ups.

In the 12 months to the end of March, Wise’s cross-border volume increased 25% to £181.7bn. Active customers grew 21% to 18.9m, while business customers grew 26% to 572,000. On a constant currency basis, underlying income grew 19% to £1,619m.

Co-founder and CEO Kristo Käärmann commented: “More and more people are using Wise at home or abroad for their everyday spending, for paying bills, for savings and investments. That’s why last month we formally launched our UK current account with a physical branch concept on Oxford Street in London.”

I’ve just got back from a trip to Poland, where I used my Wise account to pay for everything. However, it’s transferring money for large financial institutions where the big opportunity lies.

And it has partnered with some heavy hitters, including Standard Chartered and Itaú Unibanco (the largest bank in Latin America). This is how Wise plans to eventually move trillions.

The biggest risk to cross-border volume growth is a global recession caused by the inflationary war in Iran.

However, looking ahead, I reckon Wise will become a much larger company as its infrastructure becomes the plumbing for more of the world’s financial system.

The post £10,000 put in a Cash ISA a decade ago is now worth… appeared first on The Twelfth Magpie.

Should investors be worried about this call from the central bank? I’d say no. But is it time to make portfolio adjustments? Maybe. Let’s discuss.

Could the market tank?

Breeden is concerned that investors are in a complacent mood at the moment. In her view, people are ignoring the risks.

“There’s a lot of risk out there and yet asset prices are at all-time highs. We expect there will be an adjustment at some point.”
BoE Deputy Governor Sarah Breeden

And to be honest, I can see her point. I’m actually quite surprised that global markets are near all-time highs given that:

• Geopolitical uncertainty is high.
• Oil prices threaten to hit businesses and consumers.
• AI could possibly wipe out millions of jobs in the years ahead.

Personally, I wouldn’t be surprised if markets were to fall again. Because these are legitimate risks.

Be prepared and take advantage

Of course, stock market weakness is completely normal. While markets go up the majority of the time, they do have periods where they underperform.

The key, as an investor, is to be prepared for weakness. That means having the right asset mix.

Ideally, you want to have an asset allocation that matches your goals and risk tolerance and doesn’t keep you awake at night. For example, if you’re worried about the potential for a stock market crash, it’s probably not sensible to have 100% of your portfolio in shares.

It might be more sensible to have 20%–30% of your portfolio in cash. That way, if stocks fall, you’ll be less impacted.

You’ll also have firepower to capitalise on opportunities. While other investors are selling, you’ll be able to buy shares at low prices.

How I’m positioned

Personally, my own portfolio is only about 70% stocks right now. The rest is bonds, money market funds, and cash.

With this asset allocation, I can still benefit if markets move higher. However, if shares fall, the lower-risk assets will soften the blow and give me options.

Be ready to buy

I’ll point out that I’ve drawn up a list of stocks I’d like to buy if markets do fall. One name on it is Wise (LSE: WISE) – a leading international money transfer company.

I already own some shares here. But I’m keen to boost my position as this company – which I personally use to transfer money abroad all the time – continues to grow at a rapid rate.

For example, earlier this month, it told investors that it had 11.3m customers at the end of March, an increase of 22% year on year. For the quarter ended 31 March, cross-border payments volume was up 26% to a whopping £49.4bn.

Looking ahead, I expect the firm to continue growing as it offers the fastest and lowest-cost money transfers in the market. That said, a major economic collapse is a risk as is competition from other players such as Revolut.

Today, Wise trades at 27 times this year’s earnings forecast. At that valuation, I think it’s worth considering as this is a very scalable business.

Stock market weakness could present an even better buying opportunity though…

The post The stock market could plummet says the Bank of England appeared first on The Twelfth Magpie.

The share price, however, has gone nowhere. And while the company sees this as a reason to move to the US, I see an opportunity.

Payment processing

Since 2021, Wise has more than doubled its active users. And quarterly payment volumes have gone from £16.4bn to £49.4bn. 

It’s also increased its direct connections and lowered its take rate. That makes it faster, cheaper, and more reliable.

In short, Wise is twice the size and much stronger than it was when it went public. And it isn’t really slowing down.

The latest quarterly update revealed 22% growth in customers and a 26% increase in volumes. In short, things are still going well.

Despite all of this, the share price is largely where it was. And management is looking to do something about it.

The stock market

Wise’s leadership thinks the stock could do better with a primary listing in the US. And they might be right.

The company focuses on reinvesting the cash it generates. And this has worked very well in recent years.

The trouble is, that’s not what a lot the UK market is looking for. Having no dividend limits its popularity with income investors.

Wise’s share structure means it doesn’t qualify for the FTSE 100. And that cuts it off from another large investor class.

Neither of those is a bad thing intrinsically, but they don’t align well with Wise’s strategy. Neither, however, applies in the US.

UK stocks

In general, US investors are less focused on dividends. So they’re likely to be more receptive to Wise’s strategy.

A dual class share structure also doesn’t rule the stock out of the S&P 500. So it also stands to benefit from passive investing.

Wise’s management might therefore be right about what’s been holding the stock back. It could well do better in the US.

Whether or not that’s a good thing, though, depends on perspective. Low prices are bad for sellers, but they’re good for buyers.

Compared to 2021, investors have the chance to buy more than twice the business at the same price. That’s a rare opportunity.

Risks and rewards

A lower share price doesn’t change the underlying business. And it doesn’t remove any of the associated risks.

These include the impact of geopolitical tensions. This might be the biggest threat to international transfer volumes right now.

Neither Wise nor its shareholders can do much about this. So the question for investors is how to limit the overall risk.

Buying the stock at a lower price helps a lot with this. It gives investors a margin of safety against threats they can’t control.

That means a discounted share price is a good thing for buyers. And that’s why I think the UK is the place to look for opportunities.

Foolish conclusion

The UK isn’t the first place growth investors usually look. But that’s exactly why it might have the best opportunities.

Wise is a unique example. And I’m not saying every UK growth stock is systematically undervalued.

I do think, though, that less buying interest makes for better opportunities. And that’s why the UK is where I look first.

The post Why the UK might be the best place to look for growth stocks appeared first on The Twelfth Magpie.

However, a handful of the brightest UK growth firms did list in London back in 2021. One of them was Wise (LSE:WISE), the cross-border payments specialist.

And after posting another set of strong results yesterday (13 April), there’s a strong argument that this fintech is the UK’s top growth stock. Let’s take a closer look.

On a mission

For those unfamiliar, Wise’s founding mission is to “build money without borders“. Specifically to replace the hidden charges, marked-up exchange rates and slow transfers that still happen when money crosses borders.

Instead, the company’s global infrastructure moves money faster, more transparently, and at far lower cost. Over the long term, it aims to transfer trillions worldwide for consumers, businesses and banks.

In Q4 of its 2026 financial year (FY26), Wise made progress towards its ultimate aim. Quarterly cross-border volumes increased 27% on a constant currency basis to £49.4bn, while active customers grew 22% to 11.3m.

Wise was granted membership to Payments Canada in the period, opening up the potential for growth there. In Q3, it secured a conditional licence approval in South Africa and went live with a direct integration to Japan’s Zengin system.

Last year, Wise launched in Mexico, allowing Mexicans to send money abroad cheaply (and vice versa). And Itaú Unibanco, one of Latin America’s largest banks, is using Wise Platform (built for banks, fintechs, and large companies).

Quarterly underlying income jumped 24% on both a reported and constant currency basis to £435.3m. 75% of money was transferred instantly, up from 65% the year before.

For the full year, active customers were up 21% to 18.9m, driving cross-border volume 25% higher to £181.7bn. Reported underlying income rose 18% to £1.6bn, and the company expects its underlying pre-tax profit margin to be towards the top of its 13%–16% target range.

Moving stateside

Arguably, Wise doesn’t get the attention it deserves because it’s not in the FTSE 100, despite having a £10.5bn market cap. This is mainly due to its dual-class share structure, which gives the founders more control than regular shareholders (this helps prevent hostile takeovers).

In 2024, the UK overhauled the listing regime to attract growth firms and prevent others from leaving London. However, instead of joining the FTSE 100, Wise has chosen to move its primary listing to the Nasdaq.

It will keep a secondary listing on the London Stock Exchange. But the firm says this move stateside — where its largest market opportunity lies — will accelerate its “path to become ‘the’ network for the worldʼs money“.

Management is confident this will create long-term value for shareholders. As one myself, I’m optimistic the move could help Wise achieve a higher valuation.

Reasonably priced

Looking ahead, the company does face stiff competition from fintechs like Revolut (Wise has just launched a UK current account). Also, an economic slowdown could result in fewer money transfers.

Overall though, FY26 was another cracking year. With its growing global platform and massive long-term market opportunity, I do think Wise is the UK’s top growth stock today.

Currently, it’s trading at around 25 times forward earnings. At this reasonable valuation, I think it’s worth considering at around £10 per share.

The post Is Wise now the UK stock market’s top growth share? appeared first on The Twelfth Magpie.

One company that I feel doesn’t get enough attention from investors is international payments powerhouse Wise (LSE: WISE). In my view, this stock is a bit of a hidden gem in the UK market.

Strong results for Q4 FY2026

Today (13 April), Wise has posted a trading update for the fourth quarter of its 2026 financial year (FY26). And the numbers are very impressive, as usual.

For the quarter, cross-border volume grew 26% year on year (27% on a constant currency basis) to £49.4bn. Meanwhile, underlying income for the period £435.3m was up 24% on both a reported and constant currency basis.

At the end of the period, Wise had 11.3m active customers (+22% year on year). Business active customers amounted to 572,000 (+26%).

For the full FY26 year, cross-border volume was up 25% to £181.7bn. Underlying income was £1,609.2bn, up 18% on a reported basis.

It seems the market is happy with the numbers. As I write this, Wise’s share price is up about 5%.

That takes the stock’s year-to-date gain to about 12%. That’s roughly twice the gain of the FTSE 100 index.

The bull case

Now, from an investment perspective, these kinds of numbers are exciting. However, there are several other exciting parts to the investment case that are worth highlighting.

One is that the company is shortly about to move its primary listing to the US but will maintain a secondary listing on the London Stock Exchange. This could generate a lot of interest in the stock – the US market is much larger than the UK’s and investors are also far more interested in growth companies.

So, while it’s a bit of a hidden gem today, it may not be for much longer. I reckon it will be more popular once it’s listed in the US, especially given its mid-20s price-to-earnings ratio.

Another is that the company operates a ‘scale economies shared’ business model. This essentially involves continually lowering its transfer prices to enhance customer loyalty and keep customers coming back for more (note that its cross-border take rate reduced 1bp in Q4 to 51bps).

Now, a lot of investors are put off by the lowering of prices. However, this business model can actually be very powerful as it tends to really lock in customers. Amazon has had huge success with this model.

One other thing worth mentioning is that Wise has built a really great product. I use it to send money internationally all the time and I couldn’t be happier – payments are super fast and extremely cheap!

An opportunity?

In terms of risks to the investment case, competition from the likes of Revolut is one. I don’t plan to switch to another provider any time soon as Wise’s platform is brilliant but rival services are a potential threat.

Another is a general economic slowdown. This could lead to less money being transferred globally.

Overall though, I see a lot of appeal here given the business model, the growth being generated, and the valuation. I think this company is worth a closer look today, before it moves its primary listing to the US.

The post Wise: a hidden gem in the UK stock market appeared first on The Twelfth Magpie.