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hey there welcome to nepi invest congratulations to zip shareholders because today the company released a very positive training update which they titled zip cements itself as a true global buy now pay later leader and on the back of that announcement which i really liked and the market really liked we saw the share price of zip rise 23 that's right 23 in one day and i think we it's almost safe to say the share price is breaking out i'd like to see a bit of confirmation behind that before i actually say or confirm the share price is breaking up it does look like the share price is breaking out now a few weeks ago i decided to buy into zip a small holding just because i was becoming more and more bullish about what was happening in the retail sector i'll get into some reasons behind that and then on the open today just because i really like this announcement i decided to buy in now typically i can either be too patient when i see announcement like this or i can be too impulsive today the impulsive side of my investing self won out and i bought on open at 6.30 if i didn't buy and i would have been waiting a few weeks and maybe in a few weeks the share price will be significantly higher than it is now i'm hoping so i hope for all shareholders and now i am a shareholder of zip so why did i buy into zip so there was one main reason and it was on the back of some really positive training updates from retail companies on the isx really started with nick scaling on the 5th of january then every single day since then it seems like we've just been continually bombarded with positive training updates from retail companies in fact today on the 21st of january mosaic brands released a very positive training update and this saw the share price rise by upwards of at one point it was up 30 and it does make me quite sad because i was a mosaic shareholder until about december of last year i decided i was a little bit too nervous to hold him i thought there was something some things about the company i didn't like i decided to sell now my motto is no regrets so whenever you sell out of a company no regrets even if the share price goes up by 30 in one day no regrets you sure always learn that's good but just don't regret doing something you have done the other reason i bought into zip was when i looked at the abs data for november which you can see on their website and it shows you i think they released this on the 11th of january and it goes back to november retail sales i suppose the december retail sales will be released in february also but when i looked at the data we saw substantial increases in retail sales particularly in clothing and footwear and my thinking at the time was and maybe my thinking was quite wrong that a lot of uh the buy now pay later sort of users would be those who would be buying clothing and footwear so i was thinking a lot of the uh this sort of this bullishness in the retail sector will be translated to buy now payload and we'll see some bullishness in the transaction volumes moving forward so that's the other reason i was thinking of buying into buy now pay later i already hold a few retail stocks and become a little bit more diversified i don't want to hold too many retail stocks because i think in the long term i'm still quite bearish on retail stocks if i'm thinking through four years or five years particularly those who are in bricks and mortar i think even online eventually we're going to see that's a level of we won't see much growth there so the question is buy now pay ladder why not after pay so after pay is very popular share price has been going through the roof now there's two reasons i decided not to buy after pay first is i already have indirect holding enough to pay so i own a company called think smart on the london stocks exchange aim and things might have a 10 percent holding in clear pay in fact after pay bought clearpay or bought 90 of clearpay a few years ago or last year or something and the other 10 of that clearpay is owned by think smart and clearpay is doing very well it's their uk subsidiary buy now pay later and it's been doing very well and i think it'll continue to do very well in the next year or so and the other reason is when i look at the valuations of zip and after pay when i compare the two i can definitely see that zip is more undervalued and more under-appreciated than afterpay i think there's a lot of really positive sentiment uh just been under the after-pace share price for uh seems like a few months well the sentiment in zip hasn't been there and i think this announcement could turn the sentiment of zip around and we could see the share price of zip go on a really massive run from now because of this announcement so this is just the six months chart of zip and it just shows you the share price breaking out today on the 21st of january so if you go back to six months ago the share price was around 6.6.25 and then before the announcement of uh that was released today the share price was around six dollars so you can draw a line between those two prices and they'll show you the share price has done nothing over six months that that's assuming you just ignore those two peaks on the left there that really massive peak in august where the share price rose ten dollars a lot of selling on the back of that peak and then we also saw the share price rise to eight dollars in october so if you just take those peaks out smooth it out the share price has really done nothing over the last six months so if you've been holding through those peaks you've seen your share price or your holdings in zip really do nothing over that period well likewise if you look at the after pace share price over the last six months it's just been going up and up and up and up so this is the training update that got me excited that got the market excited so i really like this little table they provide in their announcement because you can look at the quarter on quarter numbers in the year on year numbers you can look at the raw numbers there on the left so you can see revenue 99.8 which is a 48 increase quarter and quarter and 92 increase year on year so what i did is i went to the previous announcement that was released or trading update that released in october and i just want to compare the quarter and quarter numbers the increases and when i look compare the two this quarter was much better than the previous quarter in fact i still remember looking at previous quarter numbers which was released in october and was not that impressed with it this announcement these numbers much more impressive in the next slide i'll just actually show you or compare the two training updates so what i'm looking in this slide is comparing this quarter to the previous quarter so what i'm looking here is the numbers on the right to be higher than numbers on the left because what i'm looking at is the quarter and quarter percentage increase in all these metrics so you wanted to see these numbers on the right to be greater the numbers on the left and that's showing that company is actually growing at a greater rate and all the numbers are higher so for instance revenue so this quarter we saw 48 increase quarter on quarter revenue the previous quarter was only a 16 increase in transactions we saw 102 increase quarter on quarter for this quarter only 23 in the previous quarter and even in customers 30 increase in customers this quarter only 15 increase in customers previous quarters so everything's growing for this company at a greater rate except maybe merchants in australia new zealand which actually went backwards from 12 growth to only 9 growth but that's nothing to be too concerned with the other thing i really like to look at is bad debts and borrowing so i want to make sure that bad debts and rears aren't increasing quarter on quarter and definitely not in this case in fact they're going back they're going down which is a really good thing so i'm liking that also like to look close not closely i like to look quickly at the borrowings to make sure nothing's out of hand so they have 1.4 billion dollars in borrowings uh the closest to maturity is may 2021. so nothing too bad when i look at borrowings or bad debts in arrears so that's another big tick in my books so i'm just comparing enough to pay the zip in this table on the left so what i'm looking at is the most recent numbers that were given from afterpay which was released in october the most recent quarterly update won't be released for the next week or so so do expect some more updated numbers here but what i'm doing is comparing after pay numbers to zip numbers so we can compare transaction volumes merchants and customers and when you compare all three of those after pay has roughly and this just roughly is roughly about two times greater than zip so i think once we get the new numbers without to pay it might be three times greater than zero but when you compare that to the market cap valuations after pay is valued at 40 billion while zip is only valued at 3 billion that's not three times as much that's 13 times as much so i think right now there's a lot of momentum and positive sentiment underpinning the after pay share price rises well i think that momentum and positive sentiment quite hasn't got into the zip share price just yet and potentially this announcement by zip today might lead to a real run in the share price moving forward so he's hoping for those shareholders who have been frustrated over the last six months or so that will see the share price finally rise just like after pay share price is rising so that's all for this video on zip hope you've enjoyed it now i'm not a financial advisor so if you do need sick financial advice make sure you seek out someone who is qualified now if you think i am crazy for buying zip over after pay make sure you leave a comment in the comment section because i like to read different points of view so how could you learn if you can't read anything that is different from your point of view so i do like to do that i like to read thoughts of people who think differently than i do so go ahead leave a comment i love to read negative comments so anyway that's all for today's video have a good day talk to you later bye