A $200 investment can go a long way. If you earned 10% per year, that $200 would be worth nearly $30,000 after five decades.
Of course, not everyone wants to wait 50 years for their money to grow. If you want faster returns, your best bet is to look at growth stocks. These investments can outpace the market over the long term, but only if you pick wisely.
Here are two fintech growth stocks worth investing $200 into right now. Both are potentially worth holding for decades, if not the rest of your life.
Buffett is betting big on this stock
It's generally a good idea to pay attention to what Warren Buffett is buying.
On that note, Buffett's holding company Berkshire Hathaway made a $750 million bet in 2021, buying shares of a fintech stock with huge growth aspirations. So far, Berkshire hasn't sold a single share, with its position now worth more than $1 billion.
The company in question is Nu Holdings (NU 1.66%), and it's not hard to see why Berkshire backed it.
Founded in 2013, Nu was created specifically to disrupt Latin America's banking industry. According to its initial public offering documents, the company claimed it was targeting a $1 trillion opportunity. For too long, it argued, a handful of incumbent banks have controlled most of Latin America's key markets. Nu intended to bring lower-cost, more-accessible financial services to the region's 650 million residents, all delivered via smartphone.
Nu's digital-first strategy enjoyed rapid adoption. Over a 10-year period, the company went from zero customers to more than 95 million. An astounding 53% of Brazilian adults are now Nu customers, more than 80% of whom interact with the company's app at least once per month.
Nu's digital-first strategy also allows it to launch new services more quickly than its brick-and-mortar competition.
Originally offering only credit and debit cards, Nu now provides access to investment accounts, insurance products, and more conventional banking and checking services. When it launched NuCripto, for instance -- a service that allows its customers to buy, sell, and transact in popular cryptocurrencies -- more than 1 million users signed up in the first month.
Since launching, Nu has expanded into Colombia and Mexico. These markets have similar dynamics to the Brazilian market, where Nu dominated the competition in just a handful of years. The company has a proven history of execution success, and the rest of Latin America should provide it with a multidecade growth runway.
Nu stock certainly isn't cheap. The shares trade at 8.4 times book value and 9.7 times sales -- a premium to most banking and growth stocks. The free cash flow yield, meanwhile, is just 2%.
But don't let these pricey multiples fool you. This is a company that can compound double-digit growth rates for decades. For patient investors, today's multiple will soon look like a bargain.
NU Price to Book Value data by YCharts
Buy this turnaround stock before it's too late
Nu stock is expensive, but it's expensive for a reason. Block (SQ 2.32%) stock, meanwhile, looks like a bargain, and there's a reason for that.
As its name suggests, Block believes the future will be built with blockchain technologies, Just don't mistake the company for a hyped-up crypto dream. Led by Twitter founder Jack Dorsey, Block owns a variety of well known platforms, including Square, the on-demand payment processor; Cash App, a peer-to-peer payment service; and Tidal, the music streaming platform founded by Jay-Z.
In 2020, Block stock became a market darling, skyrocketing in value from $40 per share to nearly $280 per share. Since those highs, however, the stock price has tumbled to less than $80.
Right now looks like a great time to make a long-term bet on Block stock. The shares trade at just 2.1 times sales, nearly their lowest valuation in history. The depressed valuation is due to a string of unexpected net losses. Although revenue continues to grow by about 25% annually, the market grew dissatisfied with the company's persistent inability to turn a profit.
Last year, Dorsey -- who co-founded Block -- returned as the company's chief executive officer, promising to return Block to profitability. On Feb. 22, the company posted its first profitable quarter in two years. "We've done a lot recently to reduce our costs," Dorsey wrote in a letter to investors. "Now we're going to focus on growth."
Block has a strong portfolio of platforms with millions of active users. If it can remain profitable and retain elevated growth rates, expect the stock's valuation to pick up considerably in 2024. Over the next few decades, meanwhile, the company is primed to capitalize on growth in promising areas like blockchain, the creator economy, and decentralized payments.
Block is a perfect buy-and-hold forever stock, especially at these prices.
