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Afterpay VS Zip share price: 3 key metrics compared

We look at the recent Amazon and eBay partnerships of both Zip and Afterpay; as well as compare three key metrics of the two buy now pay later companies.

Before we compare and contrast three of Afterpay (ASX: APT) and Zip's (ASX: Z1P) most important metrics, we take a look at the Amazon and eBay partnerships that both companies recently entered into.

Zip and Amazon deal

One of the core perils of getting to the top is maintaining your position there.

So when Zip – the fast-growing, high valuation buy now pay later (BNPL) company partnered up with e-commerce behemoth Amazon (Australia) – it was of little surprise that its share price soared as high as 22% in response.

As Zip previously commented, this Amazon deal will see 'the network of acceptance for Zip's 1.5 million digital customers’ expand significantly.

In saying this, as part of this partnership it was also noted that 14,615,000 warrants were issued on Zip's ordinary shares to Amazon with an exercise price of $4.70.

With all this considered and since this partnership was announced, Zip's stock has moved mostly sideways and currently trades around the $3.85 mark.

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Afterpay-eBay partnership

Not to be outdone by Zip, as part of Afterpay’s (ASX: APT) recent business update the BNPL company announced that it had partnered with both Mastercard and eBay Australia.

On the eBay side of things, Afterpay pointed out that as part of this partnership its services would be offered on eBay’s platform sometime in the 2020 calendar year – giving approximately 40,000 Australian small and medium enterprises access to Afterpay’s payment solutions.

'eBay Australia is the largest shopping site in the country with 11-million unique monthly visitors,' Afterpay said in a recent media release.

Afterpay VS Zip share prices: key metrics in focus

Though Afterpay (ASX: APT) leads Zip (ASX: Z1P) in terms of transaction volume, customer figures and merchant partnerships, its share price has actually lagged Zip’s since the beginning of the calendar year.

On the front of transaction volume, a proxy for revenue in the BNPL space, Zip noted that it processed $402m of transactions during the most recent quarter. Afterpay by comparison processed significantly more (though made over four months not three), citing a transaction volume figure of $2.7bn (GMV) – from July to October.

Moving on to customer numbers, Afterpay also has significantly more customers than Zip: counting 6.1m people as loyal Afterpay users. Zip has a still significant, but lower 1.4m users.

Finally, and in one area where Zip looks to be making good ground is with merchant expansion. Zip currently touts 17,890 merchants as part of its network. Afterpay, by comparison, has a little more than double that, with 39,450 merchants currently apart of its network.

Interesting however, while Zip (ASX: Z1P) operationally lags Afterpay (ASX: APT) in a number of respects, its share price has far outperformed APT on a year-to-date basis.

Since January Zip’s share price has appreciated 252%; Afterpay’s a 'mere' 162%.

I guess metrics aren’t everything.


This information has been prepared by IG, a trading name of IG Markets Limited. In addition to the disclaimer below, the material on this page does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. IG accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it. It has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Although we are not specifically constrained from dealing ahead of our recommendations we do not seek to take advantage of them before they are provided to our clients.

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