The Zip Co Ltd (ASX: Z1P) share price is rocketing today.
At the time of writing, shares in the buy now, pay later (BNPL) provider are trading for $6.88 – up 5.52%. For context, the S&P/ASX 200 Index (ASX: XJO) is 0.71% higher.
While the company hasn’t made any price-sensitive announcements today, something clearly has investors excited.
Let’s take a closer look.
Why is Zip zapping?
Share prices move for a myriad of reasons and sometimes it is not always clear what the reason is.
One reason may just be a general lift in the market’s mood. The ASX 200 is rising today and comes off the back of a few weak days for the index. Investors may very well just be in a buying mood. Zip and other growth shares tend to move with the market. Not necessarily at the same levels, and not always every day, but over the long term, the movements of the market and Zip share price match pretty well.
BNPL shares in particular are having a very good day. Besides the Zip share price, the Humm Group Ltd (ASX: HUM) share price is also about 5% higher and Sezzle Inc (ASX: SZL) shares are up 13.6% as of writing.
Overnight, the US retailing giant announced the official launch of its BNPL offering with Sezzle and Affirm (NASDAQ: AFRM) ahead of the busy holiday season. As Motley Fool has reported already, the deal with Target has the potential to boost Sezzle’s sales materially in the coming years.
Today’s Sezzle announcement may be boosting the entire BNPL sector. It may be a sign to investors of opportunities across the industry.
What else has affected the Zip share price recently?
According to its release, Zip will integrate its technology into the shopping experiences within Microsoft Edge. In turn, shoppers using the web browser will be able to use a digital payment option provided by Zip.
The integration into the company’s web browser will begin rolling out in the United States first. Microsoft is the second-largest company on the planet by market capitalisation. This news was a big deal for Zip. It is not uncommon for momentum from material developments to carry on for days afterwards.
Should you invest $1,000 in Zip Co right now?
Before you consider Zip Co, you’ll want to hear this.
Motley Fool Investing expert Scott Phillips just revealed what he believes are the 5 best stocks for investors to buy right now… and Zip Co wasn’t one of them.
The online investing service he’s run for nearly a decade, Motley Fool Share Advisor, has provided thousands of paying members with stock picks that have doubled, tripled or even more.* And right now, Scott thinks there are 5 stocks that are better buys.
*Returns as of August 16th 2021
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Teresa Kersten, an employee of LinkedIn, a Microsoft subsidiary, is a member of The Motley Fool’s board of directors. Motley Fool contributor Marc Sidarous has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of and has recommended Affirm Holdings, Inc., Microsoft, and ZIPCOLTD FPO. The Motley Fool Australia has recommended Humm Group Limited. 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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