Zip Co shares (ASX: ZIP) emerged as a standout performer on Aussie markets today, leading the ASX 200 higher with a gain of 3.86%. This continues an impressive upward trend for the buy now, pay later (BNPL) provider, which has demonstrated remarkable momentum in recent weeks. The stock’s performance reflects a combination of previous oversold conditions, and growing confidence in Zip’s business model and future prospects amid evolving market conditions.
The Zip Co share price, in closing at $2.01, is up 68.9% off April’s low, although this recent turnaround has come from a low level. The stock had sold off dramatically in the first quarter of the year, down 60% into the lows, and remaining negative YTD (-32.32%). Zooming out to the 1 year chart, and the perspective once again changes, with ZIP having delivered an impressive 73.28% in gains on the period. So what is behind such shifting sentiment?
A major catalyst behind Zip’s recent strong performance appears to be its upgraded earnings forecast for FY25. In mid-April, Zip shares surged nearly 20% in a single day after the company announced an improved earnings outlook. This announcement triggered significant investor enthusiasm, positioning Zip as one of the standout performers on the ASX and reinforcing its growing prominence in the fintech sector despite ongoing macroeconomic challenges.
While the company has not provided specific earnings guidance in its most recent updates, its participation in major investor conferences, such as the Macquarie Group Conference on May 7, signals ongoing engagement with the investment community and a willingness to provide transparency around its growth strategy.
Zip’s success highlights a broader economic recovery, particularly in consumer finance and tech-driven financial solutions. The company’s positive trajectory comes at a time when the ASX 200 has been extending three-month highs, buoyed by strong gains in US markets where both the S&P 500 and Nasdaq recently rose more than 2%.
Top Australian Brokers
- Pepperstone - Trading education - Read our review
- IC Markets - Experienced and highly regulated - Read our review
- eToro - Social and copy trading platform - Read our review
However, market analysts note that valuation concerns and ongoing uncertainty in the global outlook are potentially holding back the ASX 200 from more meaningful gains. Despite these broader market hesitations, Zip has managed to maintain its strong performance.
Zip offers two primary consumer products, Zip Money and Zip Pay, and has expanded its operations from Australia and New Zealand to now provide customer services across 12 countries. Founded in 2013 by Larry Diamond and Peter Gray, Zip has maintained its original mission to disrupt the traditional credit card model by providing more flexible payment alternatives through its BNPL technology.
Zip’s shareholder base is highly concentrated, with the top 20 investors controlling nearly 69% of shares. This level of institutional and insider ownership can provide stability, but also means that shifts in large holders’ sentiment can have an outsized impact on share price volatility.
Looking to analysts, and the average price target of $3.03 indicates a potential upside of ~50% from the current trading range. Recapturing the $2 level could be the first step towards a more sustained rally, although some technical analysts warn that the stock may be overextended following its recent run-up, and could be due for a correction if profit-taking accelerates or if broader market sentiment turns risk-averse.
Don’t Buy Just Yet
You will want to see this before you make any decisions.
Before you decide which shares to add to your portfolio you might want to take a look at this special report we recently published.
Our experts picked out The 5 best ASX shares to buy in 2025.
We’re giving away this valuable research for FREE.
Click below to secure your copy
