The Zip Co Ltd (ASX: ZIP) share price has seen big moves over the past 12 months, as the chart below shows.
The buy now, pay later business rides the wave of investor confidence when it comes to consumer spending, interest rates, and inflation.
We've seen a downward trend over the last few weeks as investors took in the news that there was a resumption of hostilities between the US and Iran.
With the Zip share price down 25% in 2026 to date, I think it's worthwhile asking whether the business is attractive to buy or not. Analysts have given their view on the company.
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Zip share price target
A share price target is how analysts tell investors where they expect the share price to trade in 12 months from the time of the investment call.
According to CMC Invest, there have been five buy ratings on the business within the last three months, so professional investors have a very positive view on the business right now.
The average price target for those five ratings was $4.03, suggesting a possible 62% rise from Zip's current price at the time of writing.
The most optimistic price target is $4.70, suggesting a potential 89% rise. The lowest price target is $3.40, implying a potential increase of 37%.
Overall, the investment professionals seem very optimistic about the shareholder returns Zip could deliver over the next 12 months.
Based on the average price target, a $10,000 investment into Zip shares could turn into approximately $18,700 in the next 12 months.
Strong financial growth
The business is projected to see significant growth in earnings per share (EPS) over the next few years.
According to Commsec, the business is forecast to generate EPS of 9.1 cents. That means it's valued at 27 times FY26's estimated earnings.
The projection on CommSec then suggests it could grow EPS by 40% in FY27 and then rise a further 43% in FY28.
That means it's now valued at less than 14 times FY28's estimated earnings. There are not many ASX shares trading at that low of a price-earnings (P/E) ratio that are expected to grow earnings by more than 40% in FY27 and FY28.
The most recent update from the company was very compelling. Total transaction value (TTV) grew 22.4% to $4 billion, total income rose 20.2% to $335.2 million, and operating cash profit (cash EBTDA) grew by 41.5% to $65.1 million.
Investors will just need to keep an eye on the ratio of net bad debts of TTV, which has been rising in recent times.
With how strongly Zip is growing and the analyst backing, it seems like Zip shares are one to consider. But it's not the only ASX stock that could be a good buy right now.
