Citi lifts PT on Australia's Zip on continued U.S. growth momentum

Zip Co

28/10/2024 20:19

** Analysts at Citi raise PT on Australia's Zip  ZIP.AX  to
A$2.9 from A$1.9
    ** Say the digital payment provider's growth acceleration in
the United States is expected to continue into Q1
    ** Brokerage forecasts total transaction value growth of 38%
in Q1 for ZIP's U.S. operations
    ** Forecasts operating expenditure growth of 8% in 1H which
is in-line with management’s expectation of 6% to 10% in FY25
    ** Estimates net transaction margin of 3.9% in FY25, which
is towards the top-end of Zip’s two-year target of 3.5% to 4.0% 
    ** Brokerage, however, downgrades stock rating to "neutral"
from "buy" as shares trade at a multiple of 26 times to
company's FY25 cash EBITDA expectations
    ** Stock has risen over 300% this year, as of last close

 (Reporting by Rishav Chatterjee in Bengaluru)
 ((Rishav.Chatterjee@thomsonreuters.com;))