The Afterpay Touch Group Ltd (ASX: APT) share price has rocketed 105% higher this year to $24.66 per share – so why have Afterpay’s shares doubled in value and is there still time to buy?
Why Afterpay’s share price is up 105% in 2019
The Afterpay share price was a top performing stock within the S&P/ASX200 Index (ASX: XJO) and has been fuelled by favourable regulatory decisions and continued expansion into the United States.
The Aussie fintech escaped from the Senate inquiry into “buy now, pay later” service providers such as Afterpay and its competitor ZipCo Ltd (ASX: Z1P) with no fundamental changes being imposed on its operations going forward.
Afterpay’s big advantage remains its ability to screen potential customers in real time at checkout, which provides a quick and easy form of consumer credit for small-to-medium-sized purchases.
Afterpay’s international expansion is a case of “so far, so good” for the fintech as it has expanded its customer and retailer base in the USA with plans to expand into the United Kingdom later in 2019.
These markets are key to the future growth of Afterpay as it looks to diversify its earnings base away from being Australia-centric given the relatively limited opportunities here.
Is Afterpay in the buy zone?
Recent news regarding a potential IPO for Afterpay’s US rival Sezzle has certainly added some interest to the Afterpay equity growth story, but I don’t see any reason why Afterpay’s growth will stop at $24.66 per share.
While the company currently generates its revenue in the form of a fee or “spread” from its retail merchant partners, the real value in Afterpay remains its future potential as a data organisation.
With targeted information on each demographic and their spending habits, Afterpay represents an advertiser’s dream and the ability to monetise this significant dataset in an ethical and profitable manner is the key to the business’ future success.
For those who think they’ve missed the boat on Afterpay, I’d check out these top growth shares which could be the next darling of the ASX.
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Motley Fool contributor Lachlan Hall has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of AFTERPAY T FPO. 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.