The Sezzle Inc (ASX: SZL) share price is out of form and sinking lower on Thursday.
In afternoon trade, the buy now pay later (BNPL) provider’s shares are down over 5% to $8.50.
Why is the Sezzle share price sinking today?
The weakness in the Sezzle share price on Thursday appears to have been driven by a broad selloff of tech shares.
It isn’t just Sezzle that is under pressure. Rival BNPL shares Afterpay Ltd (ASX: APT) and Zip Co Ltd (ASX: Z1P) are also recording sizeable declines of their own today.
This has ultimately led to the S&P/ASX All Technology Index (ASX: XTX) tumbling 2.8% lower today.
Weakness on Wall Street’s tech-focused Nasdaq index and the rotation from growth to value options appear to be responsible for this.
Is this a buying opportunity?
One broker that appears to see a lot of value in the Sezzle share price is Ord Minnett.
Earlier this week, the broker responded very positively to Sezzle’s recent first quarter update.
According to the note, the broker has retained its buy rating and lifted its price target on the company’s shares to $11.90.
Based on the current Sezzle share price, this implies potential upside of 40% over the next 12 months.
What did the broker say?
Ord Minnett was impressed with Sezzle’s first quarter update, noting that it delivered underlying merchant sales (UMS) growth ahead of its expectations.
In addition to this, the company’s repeat usage metric of 90.7% was better than its analysts were forecasting.
Another reason the broker is positive on the company is its valuation. It notes that the Sezzle share price is attractively priced in comparison to rival Afterpay. It also sees positives in the company’s pursuit of a US IPO and listing.
All in all, Ord Minnett appears to believe that it could be worth taking a closer look at Sezzle’s shares following the recent weakness. Particularly if you’re looking for exposure to the rapidly growing BNPL market.
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More reading
- Why the Afterpay (ASX:APT) share price is sliding 5%
- ASX 200 tech shares under pressure after Nasdaq selloff
- Why Dubber, Mesoblast, PointsBet, & Sezzle shares are storming higher
- Sezzle (ASX:SZL) share price shoots higher on Q1 update and US listing plans
- ASX 200 rises, Woolworths falls, Fortescue was flat
James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of ZIPCOLTD FPO. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. recommends Sezzle Inc. The Motley Fool Australia owns shares of AFTERPAY T FPO. The Motley Fool Australia has recommended Sezzle Inc. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.
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