Haha mate, you just compared Z1p to Bitcoin, which really is a controlled ponzi and went from circa $22k usd at the peak to $5,700 as of now...
As for this stock being the equivalent of a $36 SP... That is utterly wrong, this business turns its book over 8 times slower than APTs, meaning it requires 8x the Capital, to get to the same price... Currently, the SP has baked in circa $100m of EBIT at a minimum, and international expansion... It is trading at circa 15-17 LTM FY19 Revenue, its run rating circa $80m, as of now, so thats 15x run rate... While APT, which is probably going to show $300m revenue for FY19, but run rate $400m, is trading at 15x run rate too... but with 7x the efficiency, 3-5x the growth rate, and like 20x the TAM, Haha so please explain to me how this business, which is so far very much an Australian company is actually still cheap compared to APT?
As previously mentioned drawing comparison to APT is futile for the following reasons: Z1p is a lattitude/Flexi or Credit card alternative at the lower end of the credit spectrum, meaning it requires nearly 10x the credit support to hit the same volumes, so are you said the ROE on Z1p is literally 1/10th of APT.
As I mentioned in another post, When Z1p gets to $2bn in transactions, its book will be close to $1bn, requiring circa $100m of credit support, however, at this point, the business will be barely breaking even, as seen from their own projections... so the ROE at this point off $100m of credit enhancement, and far more that has been sunk into the business is effectively zero.
At scale, it could normalise to 3%, like Flexi did or GE... hence, these books tend to trade at a 9-11 pe at maturity.APT, (As would Sezzle and the host of other APT clones that are going to IPO here within 6 months - atleast 2 more) only required about $150m book, or $10-15m in credit support to hit $2bn in volume, circa a year back, and did a $33m Ebitda off said book ( I know npbt was negative) ... so thats a EBITDA to Equity of 3:1 ... thats enormous...
At a $1bn Book, APT would be doing $12-15bn odd in volume ... so its 7-10x more efficient on that metric alone... however, it would also be making hundreds of millions in ebitda, assuming the book doesnt deteriorate - which it well could.To re hash, APT is really a short payments into term lay-buy play, which offloads its risk in 45 days... Z1p as
@street talk @Christos12 mentioned has a average debtor age of 7 months...
Furthermore, Increase in revenue we are seeing now, is due to interest expense increasing, meaning the book turn is slowing further, as Transaction volume was down for this quarter ( which is normal, as Xmas period is peak)... Not withstanding that APT is going gangbusters in the US, and now the UK, overtaking companies like Affirm ( which are Z1p-esque in their offering), as the favourite payment/finance option... It has won a land grab by being first, however, as you can see there are now lots of Me-toos, who are also growing rapidly - and suprise suprise may will list here due to the buoyancy of the BNPL space. Z1ps going to the US, with the likes of Affirm and Klarna already there is probably a bad idea... as Klarna and affirm ( who are like Z1p - ie longer credit terms) have shown is not as easy to virally spread across border as the APT model... and requires an insanely large balance at that, to make it work...
Consider what a FXL was trading at, at its peak, circa $80m NPBT, this business has already surpassed that in cap.The company is currently literally trading at 15-17x FY19 pro forma LTM revenue... Thats seriously high, considering APT, which will probably run rate $300m, at a $6bn cap is run rating 20x, with 7x the efficiency, 3-5x the growth rate, and like 20x the TAM, if we consider the Aussie market is 22m people, while USA, Aus, UK is circa 400m+ people... They are both extremely valuing upside, but anyone who thinks Z1p is the cheap option, should really do the numbers...
(20min delay)