Forget Zip shares, I'd buy this fintech stock instead

I think this fintech share offers good potential this year.

| More on:
A young man looks like he his thinking holding his hand to his chin and gazing off to the side amid a backdrop of hand drawn lightbulbs that are lit up on a chalkboard.

Image source: Getty Images

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

Zip Co Ltd (ASX: ZIP) shares delivered explosive growth throughout August to October last year, reaching a four-year peak before crashing 40% in November.

Over the past 52 weeks, the Australian financial technology company's shares have zig-zagged anywhere between $1.08 and $4.93 a piece. At the time of writing, Zip shares are down 5.78% for the day, at $2.61 a piece. That means the share price is already down 22.09% for the year to date.

Zip has posted strong financial results over the past few quarters, and the business has robust growth plans for 2026. 

The fintech company is expected to post its FY26 half-year results in February, at which point investors will find out if the company is still on track. Good news could push the share price higher over a short period of time. But, with a business model closely tied to high credit risk and volatile consumer spending, volatility and unpredictability could well continue throughout 2026.

Here's another lesser-known ASX fintech share that I think could be an interesting buy for investors right now.

I'd buy Humm Group Ltd (ASX: HUM) shares instead

Humm shares are 1.33% higher at 76 cents per share at the time of writing on Wednesday afternoon. For the year to date, the shares have climbed 5.56% and they're now 26.67% higher over the year.

The Australian fintech business is a diversified finance provider that offers buy now, pay later (BNPL) products, credit cards, and finance to small to medium-sized businesses.

The business has been in the spotlight recently after fielding a takeover from Credit Corp Group Ltd (ASX: CCP). The company said Credit Corp was offering 77 cents in cash per Humm Group share, but if that offer was unsuccessful, Credit Corp would then launch an off-market takeover at 72 cents per share, "conditional upon Credit Corp achieving acceptances for 50.1% of Humm Group's shares". The bid is only a proposal at this stage.

It looks like investors are on the edge of their seats waiting to see what'll happen next.

What do analysts think of the stock?

It looks like analysts are very bullish on Humm shares over the next 12 months. TradingView data shows an analyst consensus for a strong buy rating. The maximum upside is tipped to be 87 cents this year, which implies a potential 15.23% upside at the time of writing.

Unlike the headwinds facing Zip shares right now, it looks like Humm could enjoy some decent tailwinds this year.

Motley Fool contributor Samantha Menzies has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

More on Opinions

ETF spelt out with a rising green arrow.
ETFs

I think these 2 ASX ETFs are unmissable buys in this sell-off

These investments look very attractive to me…

Read more »

A group of people in suits watch as a man puts his hand up to take the opportunity.
Opinions

Why I'm planning to act this week and buy ASX shares

It’s a great time to invest, in my opinion…

Read more »

Hand holding Australian dollar (AUD) bills, symbolising ex dividend day. Passive income.
Dividend Investing

1 ASX dividend stock down 64% I'd buy right now

This business can offer investors a number of positives…

Read more »

A target on a red background surrounded by white arrows pointing to it, indicated share price rises on or exceeding their target
Opinions

A rare buying opportunity in 1 of Australia's top shares?

This sell-off is a great buying opportunity.

Read more »

Three small children reach up to hold a toy rocket high above their heads in a green field with a blue sky above them.
Growth Shares

These 4 ASX 200 stocks could jump another 70% to 80% in 2026

These stocks are expected to rocket higher.

Read more »

Two plants grow in jars filled with coins.
Growth Shares

2 excellent ASX All Ords stocks I'd buy today

These businesses are far too cheap, in my opinion.

Read more »

Stock market chart in green with a rising arrow symbolising a rising share price.
Opinions

2 ASX shares that could turn $100,000 into $1 million

These ASX businesses are well-positioned for great growth over the next few years, and beyond.

Read more »

A young woman sits with her hand to her chin staring off to the side thinking about her investments.
Opinions

Why I'm bullish on these buy-rated ASX shares in February

When execution, growth, and industry trends align, I’m much more willing to lean bullish.

Read more »