It is difficult to get excited about Morgan Stanley’s recently announced acquisition of ETrade. The latter is essentially a no growth business (P&L below), competing in a cut-throat market. On the other hand, Square – albeit a larger company that would command a larger price – is a FinTech leader in growing consumer markets.
- Square enjoys double-digit revenue and operating cash flow growth.
- Square is a leader in the rapidly growing peer-to-peer payments market.
- Square would provide Morgan Stanley with a digital currency play (Bitcoin is approximately 10% of SQ’s revenue).
- Users can trade stocks from their Square account.