Agree. And their execution has been flawless. But APT was +$1bn market cap when they were printing txn volume numbers zip is doing now and zip's model is more profitable. Why the valuation difference?
Yes, the US is a big market and APT certainly has the track record to grab market share but basing your merchant fees at +4-5% out to the year 2200 is not realistic - unless you want to produce a model that gives you a valuation of +$20. Competition will force their pricing lower over time and their margin will be squeezed massively. If their average merchant fee drops from 4 to 3% their net transaction margin drops from 2 to 1%. And the UK?? Bought an operating buy now pay later business, raised $130m to fund it and radio silence for 6 months. Interesting.
Again, can't fault APTs execution but I think zip is grossly undervalued.
Ann: Quarterly Report and Appendix 4C, page-48
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