Afterpay Share Price Shoots Up by 2.56%, Continuing Trend
The Afterpay Touch Group Ltd [ASX:APT] share price has gone up for the second day in a row, currently up by 2.56% at $14.79.
Yesterday the stock flew almost 24% higher after the company shared incredible results in a quarterly business update. The report showed 2018 underlying sales growth of 289% over the prior year.
Afterpay is a company that deals with online payment solutions.
Why is the share price behaving like this?
Although the results would have pleased investors, something else happened today that boosted the share price’s performance.
Broker Bell Potter maintained its buy rating on the shares, and upgraded its Afterpay share price target to $21. It’s previous share price target was $10.41, so that’s quite a dramatic lift.
In addition, the broker has upgraded its earnings per share estimates for FY 2019 to 13.3 cents per share and 25.3 cents per share for FY 2020.
Earlier this year, the company entered the US online retail market. Clearly this has fared well for the Aussie fintech company.
Over 400 retail contracts have been signed, and the number is only looking set to grow given the exponential rise of e-commerce over the past decade.
Afterpay could even potentially dominate the European market as well.
Is Afterpay Touch a good investment opportunity?
Afterpay is a company with unbelievable scope for growth. It’s forecasting FY 2018 earnings of around $30 million.
It’s wise to remember that this is an industry fraught with competition. Apple, Google, Facebook, Visa, Mastercard, Paypal, Stripe — any number of these companies has been facilitating our digital payments long before Afterpay came onto the scene.
But it’s the uniqueness of Afterpay’s product that I believe will ultimately contribute to its success. Consumers who are used to footing the bill with credit cards and retail merchant fees, are likely to welcome more flexible online payment solutions. Afterpay seems to specialise in just that.
There’s a lot of talk that Afterpay’s the hottest ASX 200 stock.
I’m more interested in how they’ll fare once their competitors upgrade their offerings, but I’d certainly be keeping my eye out on this fintech company over the next couple of months.
From the outset, it’s potentially set to soar.
Editor, Money Morning
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