If you check other threads there are posters who gave lost their life savings from believing the hype going to $15 or $20 if you don't want more people to suffer that fate, it requires a contrarian viewpoint so people can make their own judgement.
As I've said before a lot of these companies not just Zip exist purely to make their founders rich and they issue glossy presentations full of impressive headline numbers but you need to get into the detail to get the true picture.
In the USA the governing body the SEC does not allow these glossy presentations just detailed financial figures.
You saw the rise up to $10.60 in the midst of excitement of headline numbers in the results then professionals looked at the cash flow statements, balance sheet and P and L and started selling the stock relentlessly.
The first red flag was in the earliest slide these results are NOT AUDITED.
Why not this is a financial services provider who should be reacting to data received in real time and it is unforgivable to not have audited accounts almost eight weeks after year end.
You are making the mistake of looking at the headline numbers and also the fatal mistake of looking at losses as a percentage of Total Transaction Volume.
The only figure that matters is the bad debts in relation to their income.
No company in history has survived on bad debts representing 33 percent of their income.
All of this investing in growth nonsense is exactly that because you don't take on more loss making growth until you have losses under control in you home territory. It's business 101
You cannot confuse warehouse facilities to fund receivables book and working capital of which they have very little.
Guess what if you are losing money hand over fist and take control over another loss making company all you do is exaggerate the problem.
Add to that your losses are going to increase because PayPal have entered the market and squeezed your margins.
A 2% reduction in margin increases losses by $20 million per $ billion of total transaction volume.
Before you know it the $60 million + in capital reserves is gone.
Why do you think American operating companies like Sezzle and Zebit (Soon) list on the ASX and not their home market.
Because they would not be able to raise capital in the USA markets with glossy headline presentations and would have to rely on real numbers.
The market is waking up to all these BNPL stocks as their business plans are fatally flawed.
You don't need to listen to me but you should listen to the market.
Nothing I post on Hot Copper is going to influence the share price with over 16 million shares traded every day but it may stop someone else losing their life savings
All IMHO and DYOR
Z1P Price at posting:
$5.99 Sentiment: Sell Disclosure: Not Held
(20min delay)