Afterpay Touch (APT) - An Absolute Screamer

[ShareFodder]

Continually misrepresented and misunderstood APT going from strength to strength.

Completely agree, many underestimate this business. But where does it end, it's $63/share and > $16b market cap today. How high can she go?

[silu]

I admit it I don't understand their valuation but then I didn't understand Wirecard either and in the end it was all a mirage.
https://www.smh.com.au/business/comp...30-p557og.html

Obviously not held

[stoploss]

When it gets close to NTA I would be interested, but at least it is now back to a more 'realistic' level than the ridiculously overvalued on any metric/ideology near $40 price it was just a month ago

Penny for your thoughts now TJ ?

[trader_jackson]

Penny for your thoughts now TJ ?

absolutely shell shocked to be honest! But congrats to holders none the less. I certainly wouldn't touch it as i just don't understand how the business could justify such a share price... an AFR article seems to agree nothing the BNPL stocks appear to be in a greater bubble than the tech companies in 2000... will this be an Amazon or a WorldCom? hard to say... although I did come close when the share price was sub $10... if only i had dipped my toe in!

[stoploss]

absolutely shell shocked to be honest! But congrats to holders none the less. I certainly wouldn't touch it as i just don't understand how the business could justify such a share price... an AFR article seems to agree nothing the BNPL stocks appear to be in a greater bubble than the tech companies in 2000... will this be an Amazon or a WorldCom? hard to say... although I did come close when the share price was sub $10... if only i had dipped my toe in!

I came across these guys when they were 3 something ... I had budget clients turning up with all sorts of debts .... looking at the bank statements I could see these payments going out . Never invested for this reason as thought they had a lot of bad clients , obviously got that wrong . Thinking about it , if it’s 4 payments they budget for , much better than a credit card at 25%.....
I suppose I did benefit as PIE Funds invested ....,

[JeremyALD]

Been my best ever investment that's for sure!

The valuation seems a bit nuts now, but I do believe this will be one of the biggest payment companies in the world so I don't have any intention to sell for now

[zgnz]

Been my best ever investment that's for sure!

The valuation seems a bit nuts now, but I do believe this will be one of the biggest payment companies in the world so I don't have any intention to sell for now

Agree with this. Already priced in the next few years growth (>100% YoY) at these prices... however, as I thought back when I first invested, this will either get taken over, or grow to become a major player in the payments space.

I have no intention of selling any time soon, as I can see the path to becoming a $USD 35-40 billion valuation company, within a 3-5 year time frame, imo.

I would add, I see little to no value in the other BNPL ASX listed companies.

[kyanar]

Agree with this. Already priced in the next few years growth (>100% YoY) at these prices... however, as I thought back when I first invested, this will either get taken over, or grow to become a major player in the payments space.

Or their entire business model will collapse under RBA regulation. They're already investigating Afterpay specifically regarding their 6% average merchant fee and no-surcharge rule, mulling over forcing them to reduce their fee or removing the "no-surcharge" rule which would make Afterpay unattractive to retail buyers with a 6% premium over cash. Afterpay's sole response so far has been to argue with the RBA that it has no jurisdiction and the RBA doesn't even know the purpose of its own mandate, which is sure to get their back up.

[zgnz]

Or their entire business model will collapse under RBA regulation. They're already investigating Afterpay specifically regarding their 6% average merchant fee and no-surcharge rule, mulling over forcing them to reduce their fee or removing the "no-surcharge" rule which would make Afterpay unattractive to retail buyers with a 6% premium over cash. Afterpay's sole response so far has been to argue with the RBA that it has no jurisdiction and the RBA doesn't even know the purpose of its own mandate, which is sure to get their back up.

The most likely outcome of any potential RBA regulation would be to allow Merchants to pass on some of the Afterpay Merchant charge (surcharge) to the customer. However I don't see many Merchants actually taking this up, as it would piss off the customers, likely reducing demand. Don't forget that people using Afterpay are spending MORE on average, and Merchants are earning more, even after Afterpay takes it's commission of 4-6%. There is a reason all these businesses have added Afterpay in the first place!

I could see some smaller Merchants passing on the charge, if they could. But Afterpay could also effectively blackout any businesses that try this by removing them from the free Afterpay Directory (currently sends 14M+ leads a month, for example.)

Regulating the actual percentage charged is a non starter. Merchants can already offer alternate BNPL providers which charge less (zip, humm) if they really want. Likewise Afterpay's commission still has to cover paying the banks credit/debit card interchange fees (when charging users' cards,) and write off bad debts (approx 1%, but varies depending on industry/business type.)

The future of the Afterpay story is in the US/Canada/UK now anyway, where RBA has no jurisdiction obviously. And if Afterpay grows so big that it is attracting regulatory responses from Governments, then I think shareholders will be happy regardless!

[alex f]

They make a big mention of active customers, but those could be people who have only used it once. I don’t understand the whole premise. You need a credit card to use Afterpay and get 42 days to make 3 payments after the 25% deposit. The credit card offers 55 days if items are bought in the correct cycle. Sounds to me like they are attracting people who have their credit cards maxed out. PB Tech offers Oxipay and Lay-bys .com So there is competition out there. The 2 founders are dumping shares today and have promised not to sell more until after the AGM.
All it would take is the credit card companies offering a similar service.