Insights

3 reasons to consider Sezzle (ASX:SZL) at this share price

There are some compelling reasons why it could be worth considering Sezzle Inc (ASX:SZL) at this share price, including the growth.
The post 3 reasons to consider Sezzle (ASX:SZL) at this share price appeared first on The Motley Fool Australia. –

fintech asx share price represented by person using smart phone to pay at checkout

There are some compelling reasons why you might want to think about Sezzle Inc (ASX: SZL) at this share price.

What’s Sezzle?

Sezzle describes itself as a rapidly growing fintech company on a mission to financially empower the next generation. It offers interest-free instalment plans at online stores and certain in-store locations.

The company claims that the increase in purchasing power for consumers leads to increased sales and basket sizes for the merchants that offer Sezzle.

It’s one of several buy now, pay later (BNPL) players on the ASX including Afterpay Ltd (ASX: APT), Zip Co Ltd (ASX: Z1P) and Splitit Ltd (ASX: SPT).

3 reasons to consider Sezzle at this share price

1: It has been declining

It’s better for investors to pay a lower price than a higher price for the same business.

Since 25 January 2021, the Sezzle share price has fallen by 9.5%. That’s a sizeable drop over such a short period of time.

Sezzle shares have also fallen by 29% since 28 August 2021, though that price peak was only for a short period of time.

As legendary investor Warren Buffett once said about share declines: “When hamburgers go down in price, we sing the Hallelujah Chorus in the Buffett household. When hamburgers go up in price, we weep. For most people, it’s the same with everything in life they will buy except stocks. When stocks go down and you can get more for your money, people don’t like them anymore.”

2: Delivering growth

Sezzle is one of the ASX shares that is delivering enormous revenue growth every quarter despite COVID-19 impacts.

It recently revealed its growth for the fourth quarter of 2020.

With underlying merchant sales (UMS), it said there was growth of 40.6% quarter on quarter and 205.4% year on year to US$320.8 million.

The average monthly UMS reached US$106.9 million, which was also an increase of 40.6% quarter on quarter and up 205.4% year on year.

Looking at Sezzle’s own income, merchant fees grew by 32.6% quarter on quarter and 195.6% year on year to US$17.2 million. However, the merchant fees as a percentage of UMS declined by 18 basis points year on year to 5.4%. The BNPL company says that is because it’s working with bigger merchants on slightly lower margins. 

The number of active consumers and active merchants increased significantly. The number of active consumers rose by 143.9% year on year to 2.23 million. Active merchants grew even quicker, rising by 166.6% to 26,690.

Sezzle reported that its active consumer repeat usage improved to 89.8%, which was up 75 basis points quarter on quarter and up 608 basis points year on year.

Sezzle executive Chair and CEO Charlie Youakim said: “Our efforts toward large enterprise merchants is paying dividends, as evidenced by our recent addition of GameStop and a number of mid-sized merchants such as UNTUCKit, Thursday Boots, Galls, Guidefitter and Pure Hockey.”

3: Exposure to the large addressable market of the US

Sezzle is focused on the US market, which has a much bigger population and addressable market than Australia. It has a sizeable market opportunity there.

Its instalment option went live in November with e-commerce platform Wix. The company’s integration is available to all Wix users in the US, Canada, India and in future regions as Sezzle expands.

However, the US is also where there is a lot of competition in the space from players like Afterpay. So the expansion into Canada and India maybe benefit the company over the long-term.

Where to invest $1,000 right now

When investing expert Scott Phillips has a stock tip, it can pay to listen. After all, the flagship Motley Fool Share Advisor newsletter he has run for more than eight years has provided thousands of paying members with stock picks that have doubled, tripled or even more.*

Scott just revealed what he believes are the five best ASX stocks for investors to buy right now. These stocks are trading at dirt-cheap prices and Scott thinks they are great buys right now.

See The 5 Stocks

*Returns as of June 30th

More reading

Tristan Harrison has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of ZIPCOLTD FPO. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. recommends Sezzle Inc. The Motley Fool Australia owns shares of AFTERPAY T FPO. The Motley Fool Australia has recommended Sezzle Inc. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

The post 3 reasons to consider Sezzle (ASX:SZL) at this share price appeared first on The Motley Fool Australia.

Trade The World Anywhere & Anytime!

Mobile app platform with over 50,000 global listed securities across 12 markets (over 70% global market capitalisation), right from your Android or iOS device.

Integrated with exclusive trading idea and investment analysis tools to help you find actionable insight on virtually every financial instrument across our 12 global markets, to help you optimise your trading strategies.

Refer Your Friends

Tell your friends about Monex and gift them FREE access to our trading tools.

We respect your privacy and will only send this one email notification to your friends. 

Share With Your Friends

Share on facebook
Share on twitter
Share on linkedin

Monex Trading Tools Access and Usage Terms

The Monex Trading Tools (referred to as ‘tools’ hereafter) are available to you inside your client portal;


To activate access to the tools, you must have a verified and approved trading account and have made a deposit of at least AUD $1000.


An active and funded account with a positive trading balance is required to continue to have access to the tools;


Although the tools are available to you indefinitely, Monex Securities may at it’s discretion disable access to the tools in the future;


Monex securities reserves the right to change these terms and conditions from time to time, as it sees fit, without notice.

Important Notice
iOS & Android App - 12 International Markets & Over 70% Global Market Cap. $0 Brokerage On US Trades. Click Here!