KeyBanc selective on big fintechs, sees upside at Visa, Mastercard

Investing.com --KeyBanc Capital Markets says the fintech sector is stabilizing after a deep valuation reset but requires selectivity as companies move through strategic overhauls.

The brokerage started Visa and Mastercard at Overweight, calling them high-quality compounders that remain central to global payments.

It also rated Fiserv and Block at Overweight on discounted valuations and improving earnings prospects, while keeping Sector Weight views on Global Payments, PayPal and Fidelity National Information Services.

KeyBanc said fintech’s market value has expanded to about $3.8 trillion from $750 billion a decade ago, driven by the rise of payment networks, merchant technology and digital finance platforms.

It expects further growth as companies align their businesses and investors regain confidence.

The firm said valuations across the “Big 7” fintechs have fallen to their lowest levels in a decade, with a median multiple of about 10.5 times next-twelve-month EBITDA, down from a five-year average of 16 times.

It sees potential for modest multiple expansion as restructurings progress and earnings compound.

KeyBanc’s analysts expect momentum into 2026 as firms complete turnarounds and benefit from new themes such as “agentic commerce,” where automation drives digital transactions.

The brokerage said Visa and Mastercard could be underappreciated beneficiaries of that trend.

It said XYZ was its top idea heading into its investor day, with scope for near-term earnings improvement and long-term growth initiatives. The bank said FI’s recovery plan is gaining traction despite reinvestment risks, while PayPal and Global Payments need clearer catalysts before re-rating.

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