Could the Afterpay (ASX:APT) share price be about to get a boost?

An expected record Black Friday sale weekend has investors watching closely…

| More on:
A woman sits on a chair smiling as she shops online.

Image source: Getty Images

The Afterpay Ltd (ASX: APT) share price will be on watch next week as the world holds its Black Friday sales this weekend.

Shoppers are cashed up and retailers are at the ready for a boom in sales this weekend. Data from the Commonwealth Bank of Australia (ASX: CBA) suggests the four-day period could present another windfall for businesses, with previous years resulting in a 14% boost to spending compared to the prior week.

With buy now, pay later (BNPL) companies now being a prominent method of payment for online shoppers, Afterpay will benefit from any increase in spending over the period.

But, what could it mean for the Afterpay share price?

How have Black Friday sales influenced the Afterpay share price historically?

In the past, Australia’s biggest provider of BNPL services has informed investors of its trading performance following Cyber Monday. In 2019 the company announced a record November sales performance. Afterpay achieved $1 billion in underlying sales for the month ending 30 November 2019.

However, between Black Friday and Afterpay releasing this update in 2019, the share price sank 5.8%. Perhaps investors were looking for a sale on the share market. The Afterpay share price proceeded to flounder around aimlessly for the remainder of the year.

In contrast, last year painted a vastly different picture. What was similar was the BNPL company setting a new monthly sales record with the inclusion of the Black Friday weekend. Afterpay notched up $2.1 billion in underlying sales in a single month — 112% more than the same month in the previous year.

Though, this time the Afterpay share price responded positively between the commencement of the sales weekend and the company’s trading update. Specifically, shares rose 4% in the space of a few days. More impressively, the share price went on to gain nearly 20% by the end of the year.

This year, the Australian Retailers Association and Roy Morgan are forecasting a record $5.4 billion in sales for Australia during the shopping frenzy. As such, Afterpay shareholders will be watching with anticipation to see how well the company does from the sale period.

Should you invest $1,000 in Afterpay right now?

Before you consider Afterpay, you'll want to hear this.

Motley Fool Investing expert Scott Phillips just revealed what he believes are the 5 best stocks for investors to buy right now... and Afterpay wasn't one of them.

The online investing service he’s run for over a decade, Motley Fool Share Advisor, has provided thousands of paying members with stock picks that have doubled, tripled or even more.* And right now, Scott thinks there are 5 stocks that are better buys.

*Returns as of January 13th 2022

Motley Fool contributor Mitchell Lawler owns shares of AFTERPAY T FPO and Commonwealth Bank of Australia. The Motley Fool Australia's parent company Motley Fool Holdings Inc. owns shares of and has recommended AFTERPAY T FPO. The Motley Fool Australia owns shares of and has recommended 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 BNPL shares