The Afterpay Ltd (ASX: APT) share price dropped from $40.50 on February 19 to just $8.90 on 23 March in the early phase of the coronavirus pandemic. That’s a whopping decrease of 78%.

Since then the Afterpay share price has been on an amazing uphill climb. At the time of writing it is trading at $57.94. That’s an increase since late March of 550%!

A positive recent business update in mid-April has definitely helped to push the Afterpay share price higher.

Afterpay has proved many critics wrong. It has continued to deliver explosive underlying sales growth despite subdued economic times.

Is it too late to buy shares in Afterpay? Or is there still a long-term opportunity for investors right now?

What other factors are driving the Afterpay share price higher?

A very positive update for its US operations in late May also helped push its share price higher. Almost 9 million US consumers have now joined its platform since its launch over 2 years ago.

In addition, WeChat owner Tencent Holdings recently become a significant shareholder in Afterpay. The popularity of the WeChat app in Asia is massive. This could potentially be an important stepping stone for Afterpay in entering the Asian market in the future.

The buy-now, pay-later (BNPL) provider continues to make significant investments to scale the business into a world-class global platform. This has included a number of recent senior management hires, and Afterpay is investing heavily in marketing. It also has brought on board a growing number of global brands such as Samsung and Foot Locker.

Afterpay also recently launched a partnership with Apple that will enable its platform to be integrated with Apple Pay. This will further simplify the process of using Afterpay and could assist in increasing adoption and usage, particularly in the US market.

Competition growing, but Afterpay’s scale advantage is still significant

Afterpay is still growing strongly in its home market of Australia and New Zealand (ANZ). However, it is now starting to face growing competition from other BNPL providers such as Zip Co Ltd (ASX: Z1P) and Openpay Group Ltd (ASX: OPY).

Despite this, Afterpay’s size and scale superiority provide a distinct advantage in winning major deals.

Afterpay is still 6 times bigger than its nearest rival Zip Co, and more than 60 times bigger than Openpay. The BPNL provider has a current market capitalization $15.5 billion, compared to only $2.34 billion for Zip Co and to only $269 million for much small rival Openpay.

Is it too late to buy Afterpay shares?

With the Afterpay share price now reaching over $55, it is now looking a bit pricey. Well factored into Afterpay’s current share price are expectations for very strong growth to continue over the next few years. However, I believe that Afterpay is relatively well-positioned to achieve this goal.

Afterpay is expanding rapidly into the massive US market and could possibly expand into mainland Europe and Asia in the future.

Further expansion globally in the BPNL sector led by Afterpay, is also likely to see further investment injected into this sector globally over the next few years.

More reading

• Zip Co share price higher despite insiders selling almost $48 million shares
• Is the Afterpay share price a boom or a bubble?
• How to try and beat the market with ASX shares
• Afterpay and 2 more ASX 200 shares to watch this week
• These 5 ASX shares were last week’s top performers

Phil Harpur owns shares of AFTERPAY T FPO. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of ZIPCOLTD FPO. The Motley Fool Australia owns shares of AFTERPAY T FPO. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

Alphabet’s (NASDAQ: GOOG) (NASDAQ: GOOGL) Google is forecast to see a decline in U.S. advertising this year due to a halt in travel amid the COVID-19 pandemic. 

According to a new report by research firm eMarketer covered by the media, Google is poised to see U.S. advertising revenue fall 5.3% in 2020, marking the first time it declined year over year since the research firm began tracking Google’s ad sales in 2008. Google is faring better than the overall U.S. advertising market, which eMarketer predicts will see a 7% decline year over year in 2020. For all of 2020, eMarketer expects the tech stock to have U.S. ad revenue of $39.58 billion. For 2019, Google weighed in with ad sales of $41.8 billion, CNBC reported. 

Google’s advertising business in the U.S. is getting hit hard given its reliance on the travel industry. With travel coming to a halt earlier in the year amid the pandemic and with people still wary about boarding planes, advertisers have been reining in their spending. YouTube ad sales are expected to continue to grow this year, but it won’t be enough to offset the overall decline in ad spending, noted eMarketer. 

“The biggest single culprit here is the travel industry, which has been both hardest hit by the pandemic generally, and has concentrated spending on Google in the past,” Nicole Perrin, principal analyst at eMarketer, told The Wall Street Journal.  

At the same time that Google is experiencing a decline in ad sales, its rivals Facebook (NASDAQ: FB) and Amazon.com (NASDAQ: AMZN) are getting a bigger piece of the pie. eMarketer expects both companies to see an uptick in ad sales this year despite the pandemic. Looking out to 2021, eMarketer does expect Google’s U.S. ads to pick up again, growing more than 20%. In 2022, it predicts ad sales will be up 11.8%, noted CNBC. 

This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

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John Mackey, CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool’s board of directors. Suzanne Frey, an executive at Alphabet, is a member of The Motley Fool’s board of directors. Randi Zuckerberg, a former director of market development and spokeswoman for Facebook and sister to its CEO, Mark Zuckerberg, is a member of The Motley Fool’s board of directors. Donna Fuscaldo has no position in any of the stocks mentioned. The Motley Fool owns shares of and recommends Alphabet (A shares), Alphabet (C shares), Amazon, and Facebook and recommends the following options: short January 2022 $1940 calls on Amazon and long January 2022 $1920 calls on Amazon. The Motley Fool Australia has recommended Alphabet (A shares) and Alphabet (C shares). We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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This article was originally published on Fool.com. All figures quoted in US dollars unless otherwise stated.

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It has been a very volatile day of trade for the S&P/ASX 200 Index (ASX: XJO). After a number of ups and downs, in early afternoon trade the benchmark index is up slightly to 5,945.6 points.

Four shares that have failed to follow the market higher today are listed below. Here’s why they are tumbling lower:

The Altium Limited (ASX: ALU) share price is down almost 3% to $32.71. Investors have been selling this electronic design software company’s shares this week after it warned that it is likely to fall short of consensus estimates in FY 2020. The latter part of the financial year, which is historically a strong period for sales, has been impacted by a second wave of coronavirus.

The Austal Limited (ASX: ASB) share price is down 4.5% to $3.51. This morning analysts at Ord Minnett retained their lighten rating but lifted their price target on this shipbuilder’s shares to $2.75. Although it sees the U.S. government’s investment in its U.S. operations as a positive, it doesn’t appear to see it as a game changer.

The Challenger Ltd (ASX: CGF) share price has tumbled 8% lower to $4.89. This morning the annuities company’s shares returned from a trading halt after the successful completion of its $270 million institutional placement. These funds were raised at $4.89 per new share, which represents an 8.1% discount to its last close price of $5.32. Challenger also announced that it has no plans to pay a final dividend in FY 2020.

The Mesoblast limited (ASX: MSB) share price is down 6.5% to $3.46. This is despite there being no news out of the biotech company. However, its shares have been very strong performers over the last three months. Since this time in March the Mesoblast share price has risen over 200%. This could have led to a spot of profit taking from investors today.

More reading

• ASX 200 flat: Westpac tumbles, Woolworths reveals strong sales growth, Challenger sinks
• Challenger share price sinks 7% lower following equity raising and final dividend update
• 5 things to watch on the ASX 200 on Tuesday
• Is the Challenger share price a buy?
• ASX Stock of the Day: Austal share price surges 9% on US Government agreement

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 Altium and Austal Limited. The Motley Fool Australia owns shares of and has recommended Challenger Limited. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

The post Why Altium, Austal, Challenger, & Mesoblast shares are tumbling lower appeared first on Motley Fool Australia.

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