Pushpay Holdings Ltd (ASX:PPH) shares drop 4% lower: Is it time to invest?

Is the Pushpay Holdings Ltd (ASX:PPH) share price in the buy zone after its bookbuild?

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The Pushpay Holdings Ltd (ASX: PPH) share price has returned to trade this afternoon after successfully completing its NZ$100m bookbuild.

At the time of writing the payment solutions company’s shares are down over 4% to $3.84.

What happened?

On Monday afternoon the company announced that it was undertaking a fully underwritten bookbuild to enable the selldown of all the shares of its co-founder, executive director, and sales executive, Eliot Crowther.

According to the release, due to personal reasons, Mr Crowther will resign as an executive director following the completion of the selldown transaction and will then resign as an employee of Pushpay on July 31.

The underwritten bookbuild saw the sale of 24,793,798 fully paid ordinary shares (9% of all issued shares) in Pushpay for a price of NZ$4.04 (A$3.78) per share and attracted bids from 19 institutional investors across New Zealand, Australia, and the United States.

The company’s CEO, Chris Heaslip, was pleased with the outcome. He stated that:

“The success of the bookbuild demonstrates strong support for Pushpay and understanding of our business proposition from a global perspective. The high level of interest and support assisted in delivering a successful outcome for the Company, our existing shareholders and new shareholders. The bookbuild attracted a number of high quality institutional investors, and the support received is testament to Pushpay’s business proposition, execution to date and future prospects.”

Should you invest?

I think Pushpay is a quality fintech share on the rise and this bookbuild appears to demonstrate that there is strong demand for its shares at the current price.

Whilst I would prefer to buy its shares at a cheaper price, there’s always a chance that such an opportunity may not be forthcoming. This could arguably make it an opportune time to consider snapping up shares along with other fintech stars such as Bravura Solutions Ltd (ASX: BVS) and Praemium Ltd (ASX: PPS).

Interestingly, Pushpay wasn’t the only New Zealand-based fintech company experiencing insider selling this week. Xero Limited (ASX: XRO) also saw a director selling shares, but it is important to note that this was via a charity trust which has long-term plans to sell shares in order to fund charitable giving.

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Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of Bravura Solutions Ltd, PUSHPAY FPO NZX, and Xero. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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