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In absolute terms, new customer additions in the US have been trending lower since a seasonal peak in the second quarter of FY21, Macquarie asserts. Now the company's re-branding is complete the next quarter will be critical and the broker will be keenly watching for a reversal of softening trends.
Furthermore, a material increase in marketing expenditure is envisaged, in order to drive market customer growth and transaction value. Citi agrees the second quarter is seasonally more important, yet expects an increase in marketing activity will support customer acquisition.
The update, overall, was in line with expectations, though this includes an increase in arrears in
Still, with customer additions slowing for the third consecutive quarter the main concern for both
Morgans found first quarter revenue growth "reasonable" while acknowledging the sales growth trajectory needs to improve meaningfully, given consensus revenue forecasts for FY22 of
Meanwhile, the impact from Tap & Zip appears to have stabilised in
The main risk to the upside comes from partnerships and acquisitions, or a turnaround during the second quarter, the broker adds. In contrast, revenue and total transaction value (TTV) beat
The
In absolute terms, growth may be strong but operating costs were not disclosed and
This is the second time where US growth has missed expectations and
The broker explains the definition of an active customer is one that has undertaken a transaction at least once in a 12-month period. In
The first quarter was tough, the broker admits, for those who own BNPL, as significant consolidation of larger players, a seasonally weak period and rebranding in the US served as dampers.
Yet the launch of several significant initiatives, including physical cards, and the expected boost to second quarter volumes should provide a catalyst. The instalment payment technology has now been integrated in the Microsoft Edge browsers and there are also large merchants to be signed up before Christmas along with completion of global acquisitions in
Shaw has hopes of a "big" quarter, noting the company is building out its geography, origination and product offering globally and leads on customer engagement. The broker also believes the stock is trading well below intrinsic value in a rapidly consolidating market and, not one of the seven stockbrokers monitored daily on the FNArena database, has a
The database has two Buy ratings, one Hold (Citi) and two Sell. The consensus target is
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