PLS Group vs Zip: Which ASX share could be a 10-bagger?

PLS vs Zip shares: Which could be a future multibagger?

When hunting for the next 10-bagger on the ASX, investors often find themselves weighing up established resource plays like PLS Group Ltd (ASX: PLS) and high-growth tech disruptors such as Zip Co Ltd (ASX: ZIP). Both companies have made a splash in their sectors: PLS Group powering Australia’s lithium ambitions, Zip shaking up the way we shop and pay. But which has the better shot at exponential returns? Here’s my breakdown of PLS Group vs Zip shares.

The case for PLS Group

PLS Group, formerly Pilbara Minerals, is a leader in Australia’s booming lithium sector. Its main asset, the Pilgangoora Lithium-Tantalum Project in WA, is one of the world’s biggest hard-rock lithium deposits. The company’s recent move into Brazil with the Colina lithium project expands its international footprint and resource base.

Turning to the key numbers:

• Market cap stands at $12.52 billion, making PLS a heavyweight in the critical minerals space.
• P/E ratio is 23.61, putting it in the “growth at a reasonable price” zone – at least vs. some resource names.
• Dividend yield, though modest at 1.31%, is fully franked – a rarity amongst lithium producers. This means shareholders may enjoy tax benefits on dividends.

Notably, the company posted an earnings per share (EPS) of $0.161 and returned $0.05 per share in dividends over the past year. However, the share price has slid 8.5% year to date, reflecting the volatility often seen in battery minerals.

The case for Zip

Zip is an ambitious fintech, best known for its digital “buy now, pay later” (BNPL) platform that operates across 12 countries. Zip aims to replace old-fashioned credit card debt with flexible, interest-free alternatives. Its two main products, Zip Pay and Zip Money, help customers spread out payments, making it popular among younger consumers and those wary of traditional credit.

Looking at the fundamentals:

• Market cap sits at $2.64 billion – about one fifth the size of PLS Group, but still a major player among local fintechs.
• P/E ratio is 22.85, almost matching PLS Group’s, showing a growth tilt even after a major short-term price pullback.
• Zip has not paid any dividend, choosing instead to reinvest back into international expansion and product development.

EPS for the last period was $0.091. What stands out sharply is its year to date return: down 37.1%, reflecting huge volatility and the ongoing challenges facing the BNPL sector.

Valuation comparison

Here’s how the two companies stack up on core metrics:

Note: Both companies’ P/E ratios are closely matched, but given they sit in very different sectors (resources vs. fintech), direct read-across can be misleading. Also, the EPS and P/E for each seems internally consistent, no red flags on calculation.

PLS Group stands out for actually paying a dividend and offering full franking. Zip, like most growth fintechs, is holding back on payouts to fund further expansion.

Recent share price momentum

Comparins recent share price performance up to 7 October:

• PLS Group closed at $3.88, up 1.8% on the day, but the 2026 year-to-date result is still a decline of 8.5%.
• Zip closed at $2.12, up 2.4% for the session, though still a brutal 37.1% loss year to date.

These readings show both are well off their 52-week highs. PLS Group’s pullback looks mild compared to Zip’s sharp slide, but both have seen some recent short-term positivity.

Which is the better buy?

If I’m searching for a potential ASX 10-bagger, I want explosive upside – but also a business that can deliver sustainable growth, not just hype. Zip, with its bruising share price and no dividend, certainly offers high risk and (in theory) high reward if it can crack profitability at scale and beat competitors. It’s a genuine disruptor but up against tough headwinds and rapidly shifting regulatory sands.

PLS Group, on the other hand, is already profitable, spinning off modest fully franked dividends, and positioned right in the thick of the global energy transition. The lithium market is volatile, but the underlying demand should keep growing as EV adoption increases. PLS Group isn’t without risk – lithium prices can swing wildly, and it is much harder for a $12 billion company to multiply tenfold than it is for a $2 billion upstart.

All things considered, if I had to back a future 10-bagger from these two, I’d lean — albeit cautiously — toward Zip. Its beaten-down share price and scalable business model give it more sheer mathematical upside, despite the clear risks. But this is not a low-risk play: only for those comfortable with volatility and the possibility of further steep losses. PLS Group feels more of a “steady compounder” right now – less likely to lose your shirt, but also less likely to shoot the lights out.

The post PLS Group vs Zip: Which ASX share could be a 10-bagger? appeared first on The Motley Fool Australia.

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Motley Fool contributor Laura Stewart has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips. This article was prepared with the assistance of Large Language Model (LLM) tools for the initial draft. Any content assisted by AI is subject to our robust human-in-the-loop quality control framework, involving thorough review, substantial editing, and fact-checking by our experienced writers and editors holding appropriate credentials. The Motley Fool Australia stands behind the work of our editorial team and takes ultimate responsibility for the content published by The Motley Fool Australia.