Jefferies upgrades Wise to 'buy'

Jefferies has upgraded its rating on money transfer specialist Wise to a ‘buy’ on the back of improving growth prospects.

The investment bank, which previously had a ‘hold’ recommendation, said: "We think Wise is at an inflection point in its card business, generating the next leg of growth after forex transfers and neo-bank like products."

Jefferies added that its own web and app traffic tracker, which allows it to asses Wise’s global app downloads, "corroborates our view on internationalisation and user stickiness, driving our 2025-26 earnings before interest, tax, depreciation and amortisation estimates 23% to 57% higher.

"Share of high interchange countries of total Wise app down downloads have increased to 40% from 33% in mid-2021, while daily active users saw an increase to nearly a third from a fifth over the same period."

It continued: "We think the widely anticipated net interest income slowdown is likely overdone, as we expect further growth in Wise Account balance mitigating the likely reduction in interest rates."

Jefferies also increased its price target on the London-listed fintech, to 1,024p from 717p.

As at 0930 GMT, shares in Wise were up 3% at 829.6p.