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Thoughts on TYRO (TYR) Payments?

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Question asked 28/05/2022

Thoughts on TYRO (TYR) Payments?

Thanks for taking my question! Best regards, Tyro has been reporting a weekly COVID trading update to investors. The release on Monday May 16th showed that Tyro’s transaction volumes over April came in at $3.216 billion, a 43% increase on the $2.246 billion the company recorded in April 2021. For May year to date, it had recorded $29.07 billion in transactions, a 35% increase from the previous year’s $21.56 billion. TYR share price closed at $3.83 on 31st May 2021; and it closed at $1.06 on 23rd May,2022. TYR share price was downgraded after the Feb 1st. half report due to higher than expected operating costs to expand the market and the Medipass acquisition. As transaction volume is a key metric to measure the success of a payment company like TYR; I believe TYR is extremely oversold and should be a good catch for medium to long term investor.

Answer

Hi Peter,

The trouble with the stocks in the payment processing space is how much value to place on transaction volumes & number of users, as we know we have seen extreme value contraction across the whole growth / tech space. Even after falling over 75% TYR its not a straightforward process to value this $539mn payment processing business given the competitive landscape is changing, with a lot more / larger well funded alternatives entering the space.

We are long in our Emerging Companies Portfolio having gone long well under $2 and we’re still under water – while MM does like TYR we cannot assume the market wont leave it in the naughty corner a little longer.

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Tyro Payments (TYR)

LAST UPDATED 27/05/2022 15:23

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