Afterpay share price rises as key players trim their positions
As Afterpay continues to trade higher, we look as some of the recent pieces of news and analysis concerning the much-hyped stock.
The Afterpay (APT) share price hit an intraday high of $21.81 a little after the open today. Yesterday the stock rallied 2.9%.
Such moves take the company well from its mid-March lows, where APT at one point traded below $10 per share.
Of course, there’s no denying that some of the shine has come off the market darling in recent times – even framed against this impressive rebound – as investors and analysts justifiably fret over everything from credit issues, slowing revenue growth and net transaction margins.
And though investors still seem to believe in the beloved cult stock, a number of key analysts have readjusted their ratings or otherwise been vindicated by their bearish views.
In March Citibank slashed its price target on APT by some 50%, UBS remained the ever-focused bear amongst the pack, and Morgan Stanley recently lowered its rating from Overweight to Equal-weight.
Afterpay share price: the lifestyle behemoth
Even with all that going on, Afterpay continues to diligently expand its offerings and reach, last week revealing that its long-awaited eBay partnership had gone live.
In fact, even though Morgan Stanley pegs Afterpay’s fair value at ‘just’ $19.00 per share – a price target which implies a shade of downside from current levels – the investment bank thinks there’s a lot to like about this new partnership. Centrally, not only will this deal give APT access to some 40,000 Australian SMEs but it will help the young company diversify its retail exposure.
Historically, APT has been heavily skewed towards fashion and beauty.
More generally, Morgan Stanley recently said:
‘We see upside risk to March quarter revenues with strong app downloads, online tailwinds and we are +10% vs. consensus,’ while noting that ‘it's too early for credit concerns to emerge, though APT could take an overlay charge. We think the litmus test will be in June or more likely September quarter.’
Watch this space.
Banks lower the stakes
Resembling a shell game of sorts, Morgan Stanley (MS) and Mitsubishi UFJ Financial Group (MUFG) yesterday updated their substantial holdings forms – as they relate to Afterpay Limited.
This marks the tenth substantial holding form update from both firms in the last three weeks.
Firstly, MUFG noted that they had reduced their Afterpay holdings to 31,286,276 fully paid ordinary shares – giving the company an 11.76% voting interest.
MUFG previously held 35,298,543 fully paid ordinary APT shares.
Secondly, Morgan Stanley revealed that it had also lowered its APT holdings to 25,793,024 fully paid ordinary shares – giving the investment bank a 9.70% voting interest.
MS previously held 29,787,503 fully paid ordinary APT shares.
How to trade Afterpay: long or short
What do you make of Afterpay’s recent rebound: can it last or will it be short lived? Regardless of your view, you can trade Afterpay and other BNPL stocks such as Zip, Splitit and Sezzle – long or short – using IG’s world-class trading platform now.
For example, to buy (long) or sell (short) Afterpay using CFDs, follow these easy steps:
- Create an IG Trading Account or log in to your existing account
- Enter ‘APT’ or ‘Afterpay’ in the search bar and select it
- Choose your position size
- Click on ‘buy’ or ‘sell’ in the deal ticket
- Confirm the trade
IGA, may distribute information/research produced by its respective foreign affiliates within the IG Group of companies pursuant to an arrangement under Regulation 32C of the Financial Advisers Regulations. Where the research is distributed in Singapore to a person who is not an Accredited Investor, Expert Investor or an Institutional Investor, IGA accepts legal responsibility for the contents of the report to such persons only to the extent required by law. Singapore recipients should contact IGA at 6390 5118 for matters arising from, or in connection with the information distributed.
The information/research herein is prepared by IG Asia Pte Ltd (IGA) and its foreign affiliated companies (collectively known as the IG Group) and is intended for general circulation only. It does not take into account the specific investment objectives, financial situation, or particular needs of any particular person. You should take into account your specific investment objectives, financial situation, and particular needs before making a commitment to trade, including seeking advice from an independent financial adviser regarding the suitability of the investment, under a separate engagement, as you deem fit.
Please see important Research Disclaimer.
Seize a share opportunity today
Go long or short on thousands of international stocks.
- Increase your market exposure with leverage
- Get spreads from just 0.1% on major global shares
- Trade CFDs straight into order books with direct market access
Live prices on most popular markets
Prices above are subject to our website terms and agreements. Prices are indicative only. All shares prices are delayed by at least 15 mins.