The Afterpay Touch Group share price has fallen 43% since August: Time to buy shares?

Source: Company presentation

It looks set to be another disappointing day of trade for the Afterpay Touch Group Ltd (ASX: APT) share price on Thursday.

In morning trade the payments company’s shares are down almost 4% to $13.17.

This latest decline means that Afterpay Touch’s shares have fallen 43% since peaking at $23.00 in August.

Is this a buying opportunity?

I think it could be. However, as with fellow tech star WiseTech Global Ltd (ASX: WTC), it is worth noting that due to the enormous amount of future growth that has been built into its share price, it is a high-risk investment option and potentially unsuitable for the average investor.

But if your risk profile allows it, I think Afterpay Touch could be a great buy and hold investment based on its early success in the U.S. market.

At its annual general meeting the company revealed that it had 450,000 active customers and over 1,150 retail merchants in the United States on its platform. Not bad considering it launched there in May.

I believe this positive start demonstrates that the Afterpay platform has the potential to replicate its Australian success in the world’s biggest retail market.

I’m not alone in thinking this way. A note out of Ord Minnett this week revealed that its analysts are becoming increasingly convinced about the global appeal of the Afterpay platform for consumers and retailers.

In light of this, the broker has a buy rating and $18.00 price target on Afterpay Touch’s shares. This price target implies potential upside of almost 37% for its shares over the next 12 months.

Incidentally, a note out of Morgans last month revealed that it is bullish on the company’s prospects as well. The strong start to life in the U.S. and positive trends in Australia led to Morgans putting an add rating and $19.15 price target on its shares.

Both brokers also have the equivalent of buy ratings on industry peer Zip Co Ltd (ASX: Z1P).

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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 AFTERPAY T FPO and WiseTech Global. 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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