ZIP (ASX) Z1P: StefanF vs the people

Originally posted by murdochVet: ↑

the risk that a company's business plans will not be successful when they are put into actionthere Stefan goes again the positive negative sandwich spin... I’d buy Zip short to medium term but long term stay with Afterpay due to here it is another of his spin words since his margin erosion myth has been debunked... execution risk.what is business execution risk?
the risk that a company's business plans will not be successful when they are put into action

it also looks at things like financial risks, regulatory risk... let’s unpack this latest positive negative sandwitch Stefanie has offered us to consider, thanks Stefanie for thinking of us poor Zip shareholders....

Zip acquired Quadpay. Analysts said there was risk the integration wouldn’t go well and also that Quadpay was too far behind a small player no momentum. Pessimistic Analysts said zips last quaryearly of 92 percent was great but not sustainable. Other analysts predicted a share price of 10 dollars in 2021 and 18 dollars in 2022 if Zip could maintain a 63 percent YoY growth of revenue, but that this would be very hard to achieve and the 92 percent YoY was just because they were a start up. Other analysts said look to PayPal a mature payments company and the growth it achieves of 12-25 percent YoY revenues.
well Zip continues to accelerate. The last 5 months have been a cracker! It’s up to 100 percent YoYAnd during COVID times putting lots of uncertainty on people’s jobs.
Quadpay acquisition looks to have been an excellent decision and in 3 months since acquisition we have seen multiple days in November when Quadpay downloads and ranking were above Afterpay

regulatory risk!
rba have recently announced once a balance is found on innovation and growth they would look at Bnpl providers and either negotiate lower merchant fees or if those Bnpl companies didn’t want to negotiate to a reasonable level the govt would force a max cap on merchant fees.
with Afterpay having the highest merchant fees in the industry they have the highest execution risk associated with regulatory change impacting merchant fees

reducing default payers and minimising late fees. Zip does credit checks already just like a credit card. Afterpay do not. Regulatory pressure may at some point ask Bnpl providers to increase the scrutiny in how they hand out their Microfinance. Zip already has the gold standard. Who will this impact most? Afterpay for one! If Afterpay are required to run credit checks at point of application there wilL be an increased operating expense associated with doing these credit checks. Impact to Zip; none, they are already being more careful than afterpay and some other Bnpl providers. Anyone can hand out a free 100 dollar note and have 100 people say yea please. But what if you had to get that 100 dollars back one day. A credit check goes some way to protecting from signing on default payers! credit cards require it. Home loans require it. Zip requires it. The issue was how long banks take to process applications. Zip has been able to maintain a reduced risk profile whil speeding up the whole process to get an account and start shopping

growth risk; zip continues to accelerate in growth of customer, increased customer satisfactionscores, and increasing the revenues per customer with smart features like tap and Zip. Offering tap and zip gives Zip Co multiple ways to grow their business. They can get more customers and or they can make. more per customer than their competitors like Afterpay. They are also driving brand awareness and loyalty through mutiple touch points

so you’re right Stefan execution risk is real!! But thinking about it Afterpay is far more exposed to execution risk than ZipCo because of how they have set their business up

attractinf key talent into your business?Afterpay have higher risk here too as the culture stinks there according to glassdoor employee scores of 3.8
zip, wonderful place to work! Why is this important. You attract the people people in the game if you have a great workplace. Any new employee giving exercise rights of zip or Afterpay would get a slight discount usually 10-15 percent on a weighted average share price. So with Afterpay your going to ask new senior employees to shell out 90 a share on a company already at 28 billion market cap vs zip offering shares at about 5.50 on one of the fastest growing global Bnpl companies in the world!

didn’t think that one through either did you Stefanie

execution risk a real issue with Zip? Myth BUSTED!

no soup for you!! NEXT!

Expand

For APT, execution risk is lower because of their one product offering and the scaling is much easier than Zip which has more products in offering.

I love Zip to be diversified coz I believe this is what a company should be in a long run. However, there is always a trade off there.

Btw, I don't own APT. I own both ZIP (big portion) and OPY (small portion).

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Last $2.55		Change -0.070(2.67%)		Mkt cap ! $3.329B

Open	High	Low	Value	Volume
$2.58	$2.62	$2.53	$15.52M	6.058M

No.	Vol.	Price($)
7	37040	2.540
13	73129	2.530
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Price($)	Vol.	No.
2.560	1237	1
2.570	742	1
2.580	28134	3
2.590	57047	4
2.600	131206	6

For APT, execution risk is lower because of their one product...

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