Big brokers still love the Afterpay (ASX:APT) share price

Could 2021 spell exciting times for the Afterpay (ASX: APT) share price? Citi is the first broker to update its price target in the new year.

positive asx share price represented by lots of hands all making thumbs up gesture

Image source: Getty Images

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

The Afterpay Ltd (ASX: APT) share price has taken a breather in recent weeks after running to an all-time record high of $123.40 on 18 December 2020. Despite the company's ballooning valuation, big brokers are still edging their Afterpay share price targets higher. 

Recent breather for the Afterpay share price 

The Afterpay share price has been choppy in recent weeks, largely driven by movements in the broader market and tech sector. The company has not announced any market sensitive news or updates since 2 December 2020 regarding new monthly sales milestone in November. 

US politics has been a key driver of the heightened level of volatility in the tech sector. Last Thursday, the Democrats were poised to take control of the Senate, threatening increased regulation. 

The control of the Senate spells good news for incoming President Joe Biden's agenda on issues including healthcare, the environment, government reform and the economy. Experts see this victory as a potential rotation away from tech shares into more cyclical sectors, similar to what the market experienced back in October and November last year. 

Brokers keen on Afterpay 

Citi is the first broker to upgrade its Afterpay share price target in the new year. The broker raised its price target from $97.75 to $115 with a neutral rating on Tuesday. 

Other brokers have yet to provide updates for Afterpay in 2021. 

Morgan Stanley previously retained an overweight rating with a $120 price target on 3 December 2020. The broker notes that Afterpay's November sales were ahead of expectations and operations appear to be on track. 

Credit Suisse initiated coverage on 7 December 2020 with an outperform rating and $124 price target. The broker anticipates a strong growth outlook to underpin strong financial performance and investor returns. 

Goldman Sachs retained its neutral rating and $99.90 price target on December 7. There was no change in rating or target after reviewing the November milestone. 

Afterpay in 2021 

Afterpay has hinted at a few things that investors can look forward to in 2021. 

Its first steps into the rest of Europe is currently pending the approval from the Bank of Spain. The company's acquisition of Pagantis in Europe will allow the company to launch into Spain, France and Italy immediately. 

Afterpay is also eyeing the South Asia market after establishing a base in Singapore. While no official plans are set, the company is looking to develop a strategy to enter this new market. 

Motley Fool contributor Lina Lim has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of AFTERPAY T FPO. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

More on ⏸️ Best ASX Shares

Three travellers laughing and smiling outside an airport
⏸️ Best ASX Shares

If you'd invested $2,000 in Webjet (ASX:WEB) shares 10 years ago, here's what it would be worth now

The travel expert has proved a winner for long-haul investors...

Read more »

illustration of three houses with one under a magnifying glass signifying mcgrath share price on watch
⏸️ Best ASX Shares

The 5 best ASX real estate shares of the 2021 financial year unmasked

Office space, industrial storage, retail malls and residential. These companies cover them all.

Read more »

asx share price increase represented by golden dollar sign rocketing out from white domes of lithium
Energy Shares

5 best ASX energy shares of the 2021 financial year revealed

As the world emerged from initial COVID lockdowns, the demand for energy soared.

Read more »

best asx 200 shares of financial year 2021 represented by 2021 formed with gold piggy bank
⏸️ Best ASX Shares

Meet the best performing ASX 200 shares of FY21. Are yours on the list?

These companies have been crowned the best of the best in FY21...

Read more »

retail asx share price represented by shopping trolley full of cash
⏸️ Best ASX Shares

How I'd build a 'best stocks to buy now' list

Focusing on the quality and prices of companies from a diverse range of sectors could make it easier to build…

Read more »

asx share price on watch represented by investor looking through magnifying glass
⏸️ Best ASX Shares

How I'd aim to find top shares to buy in March 2021

Comparing companies with their peers and considering how they might change in future could allow an investor to find the…

Read more »

Brest ASX shares represented by piggy bank surrounded by autumn leaves
⏸️ Best ASX Shares

Top ASX shares to buy in March 2021

Our Foolish contributors have compiled a list of some of the ASX shares experts are saying to Buy in March.…

Read more »

rising asx share price represented by man with arms raised against blackboard featuring images of dollar notes
⏸️ Best ASX Shares

Why the Wesfarmers (ASX:WES) share price has soared 24% in a year

The Wesfarmers Ltd (ASX:WES) share price has been a solid performer over the past year. Here's why this ASX blue…

Read more »