The Zip Co Ltd (ASX: Z1P) share price rose by 9.4% today, making it one of the strongest performers on the ASX.
About Zip Co Ltd
Zip Co provides customers with a revolving line of credit to finance their retail purchase with its brands of Zip Pay, Zip Money and Pocketbook. It is one of the largest buy now, pay later providers in Australia. Some of its largest clients include Bunnings Warehouse, Appliances Online, EB Games and Officeworks.
What’s Happened?
The Zip share price jumped over 9% today despite no official news today, although the buy now, pay later business did reissue its full 2019 annual report today after an error had been identified in the company’s remuneration report.
The 2019 financial year was a huge one for Zip after reporting that its revenue increased by 138% to $84.2 million, its transaction volume rose by 108% to $1.13 billion and its loan book jumped by 115% to $682.6 million.
Since then Zip has announced number of positive factors that have boosted its share price by 35% over the past month.
Zip completed its debt funding deal and announced the acquisition of Spotcap Australia & New Zealand, designed to fast track Zip Biz, the buy now, pay later offering for business. The acquisition will give Zip with a proven SME credit ‘decisioning’ platform that has been live in the market since 2015 and has originated over $200 million in credit lines on the platform.
Zip will also get approximately $23 million in Australian SME receivables and four years of credit performance data.
All of this progress helped the company enter the ASX 300 and should put it on the radar of fund managers who are only allowed to buy shares that are within the ASX 300.
Buy, Hold or Sell?
I’ve said before that Zip is one to watch and it’s proven to be a very strong performer. I’m not sure if I would still call it a good buy after it’s strong run, but its competitors have kept rising. There certainly is a lot of competition these days in the BNPL sector, so I’m leaning towards hold rather than buy.
If I were looking to buy a growth share today, I’d be looking at one of the ones revealed in the free report below.
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