Up 6%, the Zip (ASX:Z1P) share price is surging. Here’s why

The BNPL share is ignoring the broader market, surging higher in today’s session.
The post Up 6%, the Zip (ASX:Z1P) share price is surging. Here’s why appeared first on The Motley Fool Australia. –

The Zip Co Ltd (ASX: Z1P) share price appears to be defying expectations today, currently rallying by 5.97% to $7.45.

This follows a sharp selloff on Wall Street overnight. The tech-heavy Nasdaq Composite (NASDAQ: .IXIC) fell 1.06% and US-listed buy now, pay later (BNPL) share Affirm Holdings Inc was down by 2.85%.

Why the Zip share price is bouncing

Big players eyeing Zip shares

On Monday, a change in substantial holding announcement revealed that Bank of America Corp had increased its stake in Zip from 6.15% to 7.45%.

Bank of America has had a longstanding relationship with Zip, acting as its financial advisor and placement agent during the company’s QuadPay acquisition.

The major US bank also played a part in assisting Zip with its $400 million convertible bond raising.

Bank of America’s initial 6.15% stake was announced back in April this year.

It was also just two weeks ago the Australian Financial Review speculated that Swedish BNPL provider Klarna had accumulated a 4% stake in Zip as well.

The Klarna news witnessed a 21.98% surge in the Zip share price between 7 and 8 June.

BNPL shares bounce back

Most ASX-listed BNPL shares tumbled more than 10% last week when news broke about Apple Inc potentially launching its own BNPL service and PayPal Holdings Inc‘s plans not to charge any late fees for its BNPL services.

After a grim performance last week, BNPL shares are bouncing back today. In addition to the surging Zip share price, Afterpay Ltd (ASX: APT) shares are also up by 2.57% at the time of writing.

The Sezzle Inc (ASX: SZL) share price has bounced off session lows, but is still down 0.73% to $8.17.

Quarterly update on the horizon

In the past, Zip typically delivers its fourth-quarter results in the latter half of July.

The last time we heard a meaningful update from Zip was its third-quarter results on 13 April which was followed by a $400 million notes offering to fund the company for growth. The Zip share price rocketed almost 17% higher on the day the company’s record results were released.

The post Up 6%, the Zip (ASX:Z1P) share price is surging. Here’s why appeared first on The Motley Fool Australia.

Should you invest $1,000 in Zip right now?

Before you consider Zip, you’ll want to hear this.

Motley Fool Investing expert Scott Phillips just revealed what he believes are the 5 best stocks for investors to buy right now… and Zip wasn’t one of them.

The online investing service he’s run for nearly a decade, Motley Fool Share Advisor, has provided thousands of paying members with stock picks that have doubled, tripled or even more.* And right now, Scott thinks there are 5 stocks that are better buys.

*Returns as of May 24th 2021

More reading

Why Afterpay, ANZ, JB Hi-Fi, & Zip shares are pushing higher

ASX 200 midday update: Oil Search rejects Santos merger proposal, Afterpay rolls out Money app

These are the 10 most shorted ASX shares

ASX 200 Weekly Wrap: ASX shakes off lockdowns to rise higher

These were the worst performing ASX 200 shares last week

Bank of America is an advertising partner of The Ascent, a Motley Fool company. Motley Fool contributor Kerry Sun has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of and has recommended AFTERPAY T FPO, Affirm Holdings, Inc., Apple, PayPal Holdings, and ZIPCOLTD FPO. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has recommended the following options: long January 2022 $75 calls on PayPal Holdings, long March 2023 $120 calls on Apple, and short March 2023 $130 calls on Apple. The Motley Fool Australia owns shares of and has recommended AFTERPAY T FPO. The Motley Fool Australia has recommended Apple and PayPal Holdings. 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!