PayPay Stock Storms Nasdaq In Japan's Largest US Listing In A Decade: Cathie Wood's ARK, Retail Jump In

Japanese fintech major PayPay’s stock began trading on the Nasdaq Global Select Market on Thursday.

• PayPay, which does not offer its services in the U.S., raised $879.8 million in its IPO.
• BofA says the view on the U.S. fintech sector has improved recently.
• Stocktwits sentiment for PAYP was ‘extremely bullish.’

PayPay Corp.’s shares surged nearly 14% on their first day in the U.S. market, drawing heavy attention from retail traders on Stocktwits amid an improving sentiment for fintech companies.

Shares of the Japanese payments app operator closed at $18.16 on the Nasdaq Global Select Market on Thursday. They were listed at $16 after the company’s $879.8 million initial public offering, the largest U.S. listing by a Japanese firm in a decade.

On Stocktwits, retail sentiment for PAYP shifted to ‘extremely bullish’ from ‘bullish’ during the day, even as the stock moved 4% higher in overnight trading. Message volume for the ticker jumped 1,400%, while the watcher count rose 733% over the past 24 hours, signaling strong retail interest in PayPay.

“$PAYPAY may be volatile at first, but the offering price is an excellent one, given that PayPay has already cornered huge market share of digital transactions in Japan, with plenty more roadway to advance on,” said a user.

SoftBank-backed PayPay operates one of Japan’s largest mobile wallet apps, allowing users to make QR code payments, transfer money, and access financial services such as credit, insurance, and investments. 

It currently does not offer services to U.S. customers, but signaled plans to do so through a partnership with Visa announced last month. In PayPay’s IPO, SoftBank trimmed its stake in the company, while Abu Dhabi Investment Authority, Qatar Investment Authority, and Visa picked up shares.

Meanwhile, analysts' views on digital financial services are improving. Earlier this week, Bank of America placed ‘Buy’ ratings on six financial services companies, namely Visa, Mastercard, PayPal, Block, Affirm, and Klarna.

The brokerage said it had a “broadly constructive” view based on steady growth in payment volume, rising digital commerce penetration, and improving cross-border trends.

Lending further support to the stock, Cathie Wood’s ARK Investment Management bought 275,000 shares of PayPay worth about $4.4 million on Thursday through the ARK Fintech Innovation ETF (ARKF).

PayPay’s IPO is the largest by a Japanese company since mobile messaging service Line Corp. raised $1.3 billion in a listing in Tokyo and New York in 2016, according to Bloomberg.

Goldman Sachs, JPMorgan Chase, Mizuho, and Morgan Stanley managed PayPay’s offering.

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