GoDaddy (GDDY Quick QuoteGDDY - Free Report) partnered with Paze to integrate the latter’s online payment solution to enable small businesses to deliver enhanced checkout experience to their customers.

Notably, small businesses using GoDaddy Payments will be able to accept Paze transactions for over 150 million eligible credit and debit cards as part of the deal.

Further, the partnership enables small businesses to simplify checkout by eliminating manual card entry, reducing abandoned shopping carts, and enhancing growth.

We believe GoDaddy is expected to gain solid traction across small businesses on the back of its latest move, which will help these businesses gain customer momentum.

Growth Prospects

We believe that the latest move will solidify GoDaddy’s footing in the global digital payments market.

Per a Mordor Intelligence report, the digital payments market is expected to be valued at $14.77 trillion by 2028, exhibiting a CAGR of 11.08% between 2023 and 2028.

A Grand View Research report predicts the global digital payments market size to witness a CAGR of 20.8% during the forecast period of 2023-2030.

Strong momentum in the promising digital payments market is expected to instill investor optimism in the stock.

However, softness in the company’s core platform remains a concern.

GDDY has gained 2.1% in the year-to-date period, underperforming the industry’s growth of 15.1%.

Increasing Focus on Small Businesses

The latest move is in sync with the company’s deepening focus on small businesses.

Apart from the Paze partnership, GoDaddy recently introduced an AI-powered Instant Video feature to its Studio App, enabling small businesses to meet their need for video-based digital marketing and social commerce at no extra cost.

Further, the company unveiled three new products and services, namely Online Store Product Descriptions, Customer Service Messages, and Instagram and Facebook Ads. These allow small businesses to use generative AI to complete time-consuming tasks with reduced effort, thereby enabling business growth.

Also, GoDaddy’s introduction of new updates to its WordPress Hosting product, infusing generative AI into WordPress to help small entrepreneurs, remains noteworthy.

All the above-mentioned endeavors will likely aid GoDaddy in acquiring numerous small businesses as customers, which, in turn, will drive its top-line growth in the near term.

GoDaddy expects 2023 revenues in the band of $4.250-$4.325 billion. The Zacks Consensus Estimate for the same is pegged at $4.26 billion, implying growth of 4.05% from 2022.

Zacks Rank & Stocks to Consider

GoDaddy currently carries a Zacks Rank #3 (Hold).

Some better-ranked stocks in the broader technology sector are Asure Software (ASUR Quick QuoteASUR - Free Report) , Applied Materials (AMAT Quick QuoteAMAT - Free Report) and Arista Networks (ANET Quick QuoteANET - Free Report) . While Asure Software and Applied Materials sport a Zacks Rank #1 (Strong Buy) each, Arista Networks carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Asure Software shares have lost 2.4% in the year-to-date period. ASUR’s long-term earnings growth rate is currently projected at 27%.

Applied Materials shares have gained 46% in the year-to-date period. AMAT’s long-term earnings growth rate is currently projected at 6.10%.

Arista Networks shares have gained 61.8% in the year-to-date period. The long-term earnings growth rate for ANET is currently projected at 18.75%