Lot of things wrong with this, where do I start. At least we agree zip is massively undervalued tho.
Simply saying zip is growing 130% yoy isn't true. They went from 69mn HY 2019 to 168 or so including all quadpay (notice how they didn't include quadpay hy19) revenue? Yet they are happy to make clear all these "one off acquisition costs of integration and only mention the good bits.
APT, besides à small Spanish company and an Indonesian one which would be minimum revenue grew 100% all organically this year. From this perspective, they've proven they can grow organically even if in previous years they've acquired (albeit far smaller clearpay in comparison to QP).
Now what would be a valid argmuemnt would be to say apt only own 80% of clear pay and 80% of apt usa yet they report all customers and all revenue on their books then have a loss attributable to non controlling interests. The argument there is that zip have 100% ownership of customers and revenue whereas APT don't and this portion of revenue for APT which belongs to minority holders will always affect bottom line. We've seen today this buy out of minority interests will dilute current shareholders and cost them.
For zip, I've also covered this TTV per revenue will drop massively now that tap and zip is operational. Also not really a good indicator given customer fees (of which 60% of this makes up revenue) are tied to customer numbers and not TTv whatsoever (eg TTV could double but account keeping fee of 6 is fixed) . So it's kind of a mute indicator to model off. It'd be much more relevant or commendable if all revenue was generated by merchants and therefore forecastable.
If zip catch apt on ttv it doesn't really mean much given the higher margins for apt (4% fees to zips interchange fee and 2-4%). Zip would need to double apt in ttv for it to be comparable (which it could do given its tap and zip function and pay anywhere). Not saying it can't.
Z1P Price at posting:
$10.89 Sentiment: Buy Disclosure: Held
(20min delay)