Is the Afterpay (ASX:APT) share price in the buy zone after its update?

Is the Afterpay Ltd (ASX:APT) share price in the buy zone after today’s third quarter update. Here’s what the experts think now…
The post Is the Afterpay (ASX:APT) share price in the buy zone after its update? appeared first on The Motley Fool Australia. –

The Afterpay Ltd (ASX: APT) share price has been a disappointing performer on Tuesday despite the release of a strong third quarter update.

In afternoon trade the payments company’s shares are down 1% to $124.87.

What did Afterpay report?

Afterpay continued its meteoric rise during the third quarter of FY 2021.

It reported a strong operating performance across all regions with underlying sales rising 104% over the prior corresponding period to $5.2 billion.

This was driven by a 75% increase in active customers globally to 14.6 million and increasing customer frequency across all regions. In respect to the latter, the top 10% of customers globally on average now transact 33 times per year.

Once again, the US business was arguably the star performer during the period. It reported a 211% increase in underlying sales to $2.6 billion. This means the North America region is now the largest contributor to underlying sales.

This was supported by a 48% increase in underlying sales in the ANZ market and a 246% jump in underlying sales in the UK market.

Afterpay shares get a US listing

Also catching the eye was news that there may soon be an Afterpay share price quoted on the US share market.

Management advised that it is doing this as the US is now the largest contributor and is expected to continue growing strongly.

In addition, its shareholder base is increasingly becoming more globally focused. It feels a US listing would further accommodate this growing interest.

Where next for the Afterpay share price?

 A number of brokers have responded to Afterpay’s quarterly results with quick updates.

Ord Minnett was pleased with the company’s performance and notes that underlying sales and active customer numbers were higher than it expected. It was also happy to see the company announce a launch into Germany in FY 2022.

Ord Minnett is reviewing its buy rating and $150.00 price target. If it holds firm, its price target implies potential upside of 20% over the next 12 months.

Elsewhere, according to note out of RBC Capital, Afterpay fell a touch short of expectations during the quarter. Though, it believes the company can still achieve its second half expectations. It has an outperform rating and $150.00 price target at present.

A note out of Macquarie reveals that Afterpay performed in line with its expectations. It also spoke positively about the US listing, which it believes will provide a large capital base and competitive advantages.

However, the broker isn’t currently in a rush to invest. It has a neutral rating and $120.00 price target on its shares.

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 February 15th 2021

More reading

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of AFTERPAY T FPO. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

The post Is the Afterpay (ASX:APT) share price in the buy zone after its update? 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!