Is Openpay worth $5.00 per share?

Despite trading at a discount to its peers, Shaw remains bullish on Openpay.

  • The ASX remains the premier exchange for BNPL companies
  • Openpay has its sights set on the US market, and continues to trade at a hefty discount to its peers
  • Shaw values the stock at $5.00, though has a High Risk rating assigned to it
  • Trade BNPL stocks with IG now. Open an account here.

Afterpay’s global success opened the floodgates for a flurry of buy now pay later (BNPL) upstarts to enter the space.

In Australia alone, the laundry list of BNPL companies has grown increasingly convoluted, now starring: Afterpay, Zip, Sezzle, LayBuy, Splitit, Humm (formally Flexi Group), and Openpay. Oh and the Commonwealth Bank of Australia recently announced its own BNPL product – though it wasn’t received spectacularly.

Zooming out, on a global level, Klarna and PayPal are key players in the space, though PayPal is a relatively new entrant.

Despite all this competition, Afterpay remains the distinct leader in Australia and a fierce competitor against its global rivals. The company also generally trades at a premium to its ASX-listed peers. The table below illustrates this valuation discrepancy:


Price-to-sales ratio











Is that kind of multiple justified? We’ll get to that in a second.

On Wednesday, Openpay held an investor briefing boldly titled ‘accelerating global growth’. The deck was even replete with stylish cartoons, including a person painting over the areas on a globe, which Openpay would presumably would soon be accelerating its growth in. As the company put it, they are ‘Taking it to the next level’.

As part of this deck the company would make the well-worn BNPL points: Namely that credit card growth was declining, while the use of BNPL services was exploding, particularly among the tech savvy Gen Z.

If that wasn’t enough, the sheer scale of the opportunity was reiterated. A key part of APT’s pre-US playbook. Openpay's estimated target market has a total value of about $829 billion. Most of that is made up of big ticket retail purchases, healthcare, and education services. Auto repair and other services also factor in, and so does home improvement.

Openpay is well-funded too, recently securing $67.5 million in new funding, made up of a $37.5 million placement, $25 million in debt and a $5 million share purchase place (SPP).

Funding aside, analysts from Shaw took two key positives from that investor briefing. One, the broker’s analysts flagged the size of the US market as a key positive, which compares favourably to the relatively small Australian and UK market.

Beyond market size, Shaw analysts were impressed by OPY’s product offering, saying:

‘The clearly differentiated offering to its homogenous “pay-in-4” and short term (<2 months) peer offering (much higher ATV, longer 2-24 month tenure, non-Retail vertical focus on Health/Auto/Home, older demographic, etc.).’

With those factors in mind, Shaw reiterated their Buy rating and $5.00 price target on OPY.

Ultimately, when using a FY22 Enterprise Value/ Sales multiple, OPY trades at a 47% hefty discount to its BNPL peer group – which includes Afterpay, Humm, IOU, LayBuy, Splitit, Sezzle, and Zip.

Shaw evidently thinks the market has some course correcting to do.

Trade BNPL stocks long and short with IG today.

Create an IG trading account or log in to your existing account to get started now.

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.

Live prices on most popular markets

  • Forex
  • Shares
  • Indices

Prices above are subject to our website terms and agreements. Prices are indicative only. All shares prices are delayed by at least 15 mins.


Prices above are subject to our website terms and agreements. Prices are indicative only. All shares prices are delayed by at least 20 mins.

The Momentum Report

Get the week’s momentum report sent directly to your inbox every Monday for FREE. The Week Ahead gives you a full calendar of upcoming key events to monitor in the coming week, as well as commentary and insight from our expert analysts on the major indices to watch.

For more info on how we might use your data, see our privacy notice and access policy and privacy webpage.

You might be interested in…

Find out what charges your trades could incur with our transparent fee structure.

Discover why so many clients choose us, and what makes us a world-leading provider of CFDs.

Stay on top of upcoming market-moving events with our customisable economic calendar.