If you invested $1,000 in Afterpay (ASX:APT) shares 4 years ago, here's what it would be worth now

The company's shares have been the talk of the town…

Child investor of ASX shares sitting alongside homemade money-making machine.

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 rocketed higher over the past few years, thanks in part to its first-mover advantage. Everyday consumers have been increasingly adopting the buy now, pay later (BNPL) company's services as a replacement for credit cards.

Over the past 12 months alone, Afterpay shares have accelerated by more than 80%, reflecting positive investor sentiment.

How has Afterpay performed in recent times?

At the beginning of COVID-19, Afterpay shares sank to a multi-year low of $8.01 on 23 March 2020. The company's shares quickly picked up as the federal government introduced stimulus packages such as JobKeeper. The initiative was designed to ensure people whose jobs had been impacted by the pandemic would continue to receive a wage and, thus, spend on discretionary items to keep the economy ticking over.

In the months following, Afterpay shares soared to dizzying heights, as the sky appeared to be the limit. The Afterpay share price hit an all-time high of $160.05 in February 2021, before sliding to around the $100 mark by late March. This was due largely to new BNPL competitors such as PayPal Holdings (NASDAQ: PYPL) signalling their interest in entering the market.

Since then, Afterpay shares mostly moved in circles until last week, when the company received a takeover offer from Square Inc (NYSE: SQ) for $39 billion.

The United States-based payments company proposed a fixed exchange ratio of 0.375 shares of Class A common stock for each Afterpay share held. The news sent Afterpay shares flying 30% to a high of $125.00 when the ASX opened up last Monday.

What if you had invested $1,000 in Afterpay shares 4 years ago?

If you had invested $1,000 in Afterpay shares in 2017, you would have bought them for around $2.95 apiece. This would have given you approximately 338 shares, without topping up when they fell to near all-time lows during COVID-19.

Fast-forward to today, the current Afterpay share price at the time of writing is $132.15. This means that those 338 shares would now be worth an astonishing $44,666.70 (338 shares x $132.15). When considering percentage terms, this implies an upside of almost 4,380%.

This is a mammoth return, particularly considering the S&P/ASX 200 Index (ASX: XJO) has given back an average of 6.50% per annum over the last 5 years.

Are Afterpay shares a buy now?

Two brokers rated the company with different price points last week. The first was Morgans, which raised its rating by 8% to $123.40. Following suit, Macquarie also raised its 12-month price target by 14% to a bullish $160.00.

Motley Fool contributor Aaron Teboneras has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. owns shares of and has recommended AFTERPAY T FPO and Square. The Motley Fool Australia owns shares of and has recommended AFTERPAY T FPO and Macquarie Group Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

More on Share Gainers

A happy young couple lie on a wooden deck using a skateboard for a pillow.
Share Gainers

These were the best-performing ASX 200 shares in March

These shares made their shareholders smile in March thanks to some very big gains.

Read more »

Stock market chart in green with a rising arrow symbolising a rising share price.
Share Gainers

Here are the top 10 ASX 200 shares today

It was a massive day for the ASX 200, with a new all-time high recorded.

Read more »

A man sits thoughtfully on the couch with a laptop on his lap.
Technology Shares

This ASX tech stock rocketed 60% in March! Can it keep on delivering?

After soaring in March, the ASX tech stock is now up 169% since this time last year.

Read more »

A young women pumps her fists in excitement after seeing some good news on her laptop.
Share Gainers

Why Mesoblast, Newmont, Pilbara Minerals, and Platinum shares are jumping

These ASX shares are ending the week strongly. But why?

Read more »

A young male ASX investor raises his clenched fists in excitement because of rising ASX share prices today
Share Gainers

3 ASX All Ords shares up 50%+ in March

These ASX shares have been on fire this month. But why?

Read more »

Woman looks amazed and shocked as she looks at her laptop.
Share Gainers

Why Mesoblast, Patriot Battery Metals, Sigma, and Zip shares are pushing higher

These shares are having a good session on hump day. But why?

Read more »

Woman looks amazed and shocked as she looks at her laptop.
Consumer Staples & Discretionary Shares

If you'd put $20,000 in this ASX retail stock at the start of 2023, you'd have $134,000 now

This online retailer has executed a remarkable turnaround for its investors.

Read more »

Fancy font saying top ten surrounded by gold leaf set against a dark background of glittering stars.
Share Gainers

Here are the top 10 ASX 200 shares today

It was back to earth for ASX shares this Tuesday.

Read more »