All eyes are on the Zip Co Ltd (ASX: Z1P) share price but the Afterpay Ltd (ASX: APT) share price could soon be back in the spotlight.
Investors have been focused on the Zip share price after it released a better-than-expected update and move straight into a $400 million capital raise.
The Zip share price fell 1.4% to $9.48 this morning and Afterpay lost a similar amount to $126.12.
In contrast, the S&P/ASX 200 Index (Index:^AXJO) shed 0.4% to fall to just under the psychologically important 7,000 mark.
Upcoming update puts Afterpay share price back in spotlight
But Afterpay could be back in focus when it releases its quarterly trading update. This update is due before the end of this month.
Like Zip, Afterpay could surge if the update beats expectations. While it's hard to know precisely what the consensus forecast is, Morgan Stanley thinks it's around what it is predicting.
What investors are expecting from Afterpay's update
"We look for 14.8m active users (+76% YoY) and A$4.9bn GMV (+90% YoY) in APT's March quarter (3Q21) update," said the broker.
"While quarterly consensus is hard to gauge, our 2H21 forecasts are in line with consensus.
"Split by region, we expect A$2.1bn GMV for ANZ and A$2.4bn for the US. We expect 3.5m ANZ users vs 9.4m US users."
If Afterpay can beat those numbers, it will almost certainly trigger a share price rally for the buy now play later group.
US growth the key focus
More specifically, the US figures could be the main one to watch. This is where Zip Co excited the market.
"APT's US app downloads were particularly strong in the month of March at 760k, or 3x the amount of the prior year, and exceeded Dec 2020 levels (730k)," added Morgan Stanley.
"This will support future growth. US BNPL peers did not see an increase as large as APT in March."
Talk about the weight of expectation!
What is the Afterpay share price worth?
But die-hard Afterpay supporters can take heart. Morgan Stanley doesn't think Afterpay needs to beat expectations to look cheap.
The broker has an "overweight" recommendation on the Afterpay share price with a 12-month price target of $149 a share.
That leaves a more than 18% upside for the Afterpay share price.
