Up another 6%, Zip (ASX:Z1P) share price hits 2-month high

Looks like the BNPL provider is staging somewhat of a comeback…
The post Up another 6%, Zip (ASX:Z1P) share price hits 2-month high appeared first on The Motley Fool Australia. –

The Zip Co Ltd (ASX: Z1P) share price looks like it’s making a comeback, up another 6.19% today to $8.58 at the time of writing.

The last few months have arguably tested the resolve of Zip shareholders, with the company’s shares sliding as low as $6.32 on 13 May.

One recent event that may have been particularly frustrating for investors was the announcement of the company’s European and Middle East expansion on 24 May. The Zip share price tipped 3% higher to $7.25 on the day, but came back to pre-announcement levels just a few days later.

The Zip share price has lifted an extraordinary ~25% over the last 9 trading sessions. Let’s take a look at what could be helping boost the company’s shares to a new 2-month high.

Tech back in favour

Zip has provided a number of positive announcements throughout the year, including its half-year results and third-quarter update. These reiterated the opportunity at hand and the company’s strong growth trajectory.

Despite the positive news, Zip shares tanked all the way from ~$14.50 record highs on 16 February to the $6.32 low on 13 May.

Arguably, the tumbling Zip share price was more closely linked to the wider tech sell-off than any factors related to the company itself.

Between Zip’s highs and lows, the S&P/ASX 200 Info Tech Index (ASX: XIJ) also tumbled by about 25%.

Many of Zip’s tech peers, including Afterpay Ltd (ASX: APT), Xero Limited (ASX: XRO), NextDC Ltd (ASX: NXT) and WiseTech Global Ltd (ASX: WTC), were also caught up in the market’s rotation out of technology stocks.

The ASX 200 Info Tech Index has rebounded some 25% since its late-May lows, somewhat coinciding with the recent resurgence of Zip shares.

Over on Wall Street, the tech-heavy Nasdaq Composite (NASDAQ: .IXIC) hit a new all-time high on Tuesday night.

Afterpay and Zip shares bouncing back

Both ASX buy now, pay later (BNPL) shares, Afterpay and Zip, have been bouncing back strongly in recent weeks.

Despite the resurgence of these leading BNPL names, smaller players such as Splitit Ltd (ASX: SPT), Laybuy Holdings Ltd (ASX: LBY) and Openpay Group Ltd (ASX: OPY) have struggled to follow.

With concern over rising interest rates ever present, it’s possible some investors returning to the sector are choosing to get behind bigger, stronger players, rather than what could be perceived as more speculative investments in smaller players.

The post Up another 6%, Zip (ASX:Z1P) share price hits 2-month high appeared first on The Motley Fool Australia.

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More reading

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Motley Fool contributor Kerry Sun owns shares of NEXTDC Limited. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of and has recommended AFTERPAY T FPO, WiseTech Global, Xero, and ZIPCOLTD FPO. The Motley Fool Australia owns shares of and has recommended AFTERPAY T FPO, WiseTech Global, and Xero. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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