It's been a fairly bleak day for ASX shares so far this Wednesday. At the time of writing, the All Ordinaries Index (ASX: XAO) has slipped by 0.44% to back under 6,800 points. But it's a very different story when it comes to the Sezzle Inc (ASX: SZL) share price.
Sezzle shares are presently having a blast. Literally. This ASX buy now, pay later (BNPL) share has rocketed an astonishing 32% so far today to 52 cents a share. That comes after the Sezzle share price closed at 39 cents yesterday and rose as high as 58 cents a share this morning (up almost 49% at the time).
It was only last week that Sezzle shares hit a new all-time low of just 25 cents a share. That means Sezzle has now climbed by 132% in only the past five trading days. But we still remain a long way from the ~$2.40 levels we saw soon after Sezzle's initial public offering (IPO) back in 2019.
The rally of the past week comes after one of the worst months in Sezzle's history as an ASX share. As my Fool colleague Bronwyn covered on Friday, Sezzle was one of the worst-performing shares on the entire All Ords index over June, losing half of its value in just a month.
Why was the Sezzle share price at a 52-week low?
As we covered at the time, it seems that concerns over inflation, rising interest rates and a possible recession were what was causing consternation among investors over Sezzle shares last month. There are also concerns that the BNPL sector is headed for more regulation in the future.
On the first point, last month saw Sezzle telling investors that it was "focusing on driving its credit losses below the 2% threshold of total transaction volumes". Sezzle also flagged that it is responding to higher inflation by increasing both merchant and consumer fees.
On the second, it was revealed late last month that Financial Services Minister Stephen Jones is actively looking to introduce further regulations to the BNPL sector within a year, calling BNPL services "clearly" a form of credit.
So it was a combination of these factors that probably led to Sezzle's new 52-week low last week. But it's unclear why Sezzle is shooting so much higher today (indeed over the past few days). Perhaps some value investors have finally decided Sezzle shares got too cheap to ignore at 25 cents each. Whatever the cause, it's certainly been a good week for the Sezzle share price.
