ZIP +16.54%: shares in Zip surged to 6-week highs today after showing signs of improvement at the 4th quarter update. We hosted co-founder Peter Gray today who was keen to talk up the turnaround in the business which saw revenue grow 27% year on year, and transaction volume growth of 20%. Margins remained more or less stable in the final quarter and while the loss rate fell in the US business to 2.7% for the quarter, it still remains above the group cash margin of 2.4%. Management has now firmly stepped away from the growth for the sake of growth plans. The Sezzle deal fell over last week, and Zip is now looking to cut their losses in Singapore along with other non-core geographies, essentially anything other than the US, Australia or New Zealand. Overall, a solid update showing signs of improvement but still a lot of work to be done to make it profitable.
MM is neutral ZIP
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