Why this broker sees more upside in the Raiz (ASX:RZI) share price

The fintech company has got the tick of approval from a leading broker.

| More on:
Three different hands against a blue backdrop signal thumbs up, indicating share price rise on the ASX market

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 Raiz Invest Ltd (ASX: RZI) share price has had a stellar year so far.

But, according to one leading broker, shares in the micro-investing platform could go even higher.

Let’s have a look at the fintech company and what’s happening with its share price.

Broker paints positive outlook on Raiz share price

Shares in Raiz could receive a boost after a bullish note from renowned broker Taylor Collison.

Analysts slapped a ‘speculative buy’ rating on the company, highlighting the large market opportunity in the micro-investing landscape.

According to the broker, Raiz remains well-positioned to capitalise on the market opportunity, citing its positive cash flow and solid balance sheet.

The note highlighted several other factors that could propel the fintech’s growth.

In particular, analysts noted the company’s continued increase in active users and funds under management.

Raiz also has an expanding pipeline of growth products and innovations such as its superannuation and ESG offerings.

The company’s expansion into Southeast Asia was also lauded as an ideal hunting ground given the region’s high mobile phone usage, large aspirational populations and small-scale investors.

Analysts also waived the company’s recent boardroom conflict as an unwelcome distraction, citing no effect on Raiz’s business performance.

The note pointed to Raiz’s recent full-year report as an indicator of its growth potential.

How did Raiz perform in FY21?

The Raiz share price received a huge boost after releasing its full-year report for FY21.

The fintech reported impressive growth to 30 June 2021, highlighting a strong balance sheet with cash on hand of $19.4 million.

Other highlights from Raiz’s full-year report included;

  • 37% year on year (YOY) increase in group revenue of $13.4 million
  • global active customers up 87% YOY to 456,927
  • Australian funds under management (FUM) up 76% YOY to $799.6 million
  • superannuation FUM up 53% YOY to $106.6 million
  • micro investing platform segment revenue up 40% YOY to $11.4 million
  • revenue per customer (run rate) in Australia up 32% YOY

Throughout the financial year, Raiz noted implementing a number of features to increase customer engagement.

Snapshot of the Raiz share price

Raiz is an Australian financial technology (fintech) company that provides users with a mobile-focused micro-investing platform.

The company has a tiered revenue model consisting of maintenance fees, account fees, netting and advertising fees.

Since the start of the year, shares in Raiz have bolted more than 90%.

The Raiz share price closed Friday’s session at $1.80.

Motley Fool contributor Nikhil Gangaram has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

More on Broker Notes

Broker looking at the share price on her laptop with green and red points in the background.
Broker Notes

Broker gives its verdict on the CSL share price post-FY22 results

Here's what this broker is saying about the CSL share price...

Read more »

a man sits in unhappy contemplation staring at his computer on his desk in a home environment, propping his chin on his hand.
Resources Shares

The ASX 200 share Firetrail just bought after brutal sell-off

If a stock has lost one-third of its value over the last four months, would you be courageous enough to…

Read more »

a man and a woman sitting in a technology related work environment high five each other while the man wears headphones around his heck and the woman sits in front of a laptop.
Growth Shares

Revenue up 169%: 2 ASX tech shares showing explosive growth

Growth stocks have roared back the past few weeks. Here is a couple that Cyan fund managers think can go…

Read more »

A man wearing a shirt, tie and hard hat sits in an office and marks dates in his diary.
Broker Notes

Is the BHP share price a buy after the miner’s FY22 results?

Is this mining giant a buy? Here's what this broker thinks...

Read more »

Red buy button on an apple keyboard with a finger on it representing asx tech shares to buy today
Broker Notes

Top brokers name 3 ASX shares to buy today

Brokers are feeling bullish about these ASX shares...

Read more »

A woman sits crossed leg on seats at an airport holding her ticket and smiling.
Travel Shares

Own Flight Centre shares? Here’s what to expect from its FY22 results

Here's what to expect from Flight Centre's FY 2022 results...

Read more »

A man leans forward over his phone in his hands with a satisfied smirk on his face although he has just learned something pleasing or received some satisfying news.
Blue Chip Shares

Brokers say BHP and this ASX 200 share are buys

Here are two ASX 200 shares rated as buys....

Read more »

A female broker in a red jacket whispers in the ear of a man who has a surprised look on his face as she explains which two ASX 200 shares should do well in today's volatile climate
Broker Notes

Goldman Sachs tips huge returns for the Goodman share price

Goldman Sachs says Goodman's shares could rise materially..

Read more »