Insights

This tumbling ASX fintech should be 3 times current price: analyst

The market savaged this micro-investment provider, causing one fund manager to tear his hair out. But maybe it’s now turned a corner?
The post This tumbling ASX fintech should be 3 times current price: analyst appeared first on The Motley Fool Australia. –

One ASX financial stock has been savaged in the past month but that just doesn’t match up with its fundamentals.

That’s according to Cyan Investment Management portfolio manager Dean Fergie, who’s frustrated by the market’s treatment of RAIZ Invest Ltd (ASX: RZI).

Over the month of May, the micro-investment app’s shares sank 13%, from $1.53 to $1.33.

“We have been somewhat perplexed by the weakness in consumer investment platform Raiz’s share price in recent months,” Fergie said in a memo to clients. 

“Raiz’s performance is at odds with a strong underlying market and the company’s continued growth in both FUM and customer numbers.”

He could only attribute the negative sentiment to “some indigestion and associated selling” from a $10 million share placement in late April.

US version of Raiz worth $2.8 billion

Raiz allows users to round-up everyday purchases and put those cents into investments such as shares.

It was originally the Australian version of US company Acorns. The local version rebranded and became independent of its American parent in 2018.

Acorns in the US announced recently that it would list on the NASDAQ via a special-purpose acquisition company (SPAC), in a deal that values the business at about US$2.2 billion ($2.8 billion).

To Fergie, that backed up his bullishness on Raiz.

“On similar valuation metrics such as customer numbers and FUM [funds under management], would value Raiz at somewhere around AUD$4 per share or 3 times its current pricing.”

Rest of market starting to wake up

It seems other investors have woken up to what Fergie is indicating.

Raiz shares rocketed 7.14% on Wednesday morning to trade at $1.50. That’s almost a 13% pick up in the first few days of June.

This week the company revealed funds under management have reached $750 million. According to Raiz, this keeps it on track to achieve its previously stated goal of $1 billion by the end of this year.

According to The Motley Fool’s Brooke Cooper, Raiz now has 76.2% more funds under management than 12 months ago.

The post This tumbling ASX fintech should be 3 times current price: analyst appeared first on The Motley Fool Australia.

Wondering where you should 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 could be the five best ASX stocks for investors to buy right now. These stocks are trading at near dirt-cheap prices and Scott thinks they could be great buys right now.

*Returns as of May 24th 2021

More reading

Here’s why the Raiz (ASX:RZI) share price has gained 5% today
How does Raiz (ASX:RZI) stack up against its old friend Acorns?
Why the Raiz (ASX:RZI) share price is edging lower

Tony Yoo has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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!