The Commonwealth Bank of Australia (ASX: CBA) share price has been very kind to ASX investors for a long time now.

Although CBA shares have retreated around 7% from the new all-time high of $106.57 that we saw last month, they are still up by 17.95% year to date and 35.82% over the past 12 months.

This ASX bank is also up around 70% from the lows it reached during the coronavirus-induced market crash last year. That’s all based on yesterday’s closing CBA share price of $98.78 a share.

But it’s CommBank’s performance over the past 3 months that has been especially interesting. The CBA share price has returned 12.5% since mid-April, better than any of the other major ASX banks. Far better, in fact.

Take the Westpac Banking Corp (ASX: WBC) share price. While CBA returned a very healthy 12.5% return over this period, Westpac shares instead delivered a loss of 0.24%. That’s based on Westpac’s closing share price of $25.27 yesterday.

So why such a large gap here? A gain of 12.5% over 3 months is a big deal when you’re talking about a $175 billion company.

CBA share price tops ASX banks over past 3 months

Well, for starters, it’s worth noting CBA enjoys a significant scale advantage over its big four banking brethren. CBA currently has a market capitalisation that is close to double its nearest rival. This happens to be Westpac, which is currently valued at $92.7 billion.

Scale matters in banking, and CommBank’s advantage here is probably conducive to the higher price-to-earnings (P/E) valuation multiple the CBA share price currently enjoys over the other ASX banks.

Another notable factor is CBA’s massive cash buffer. As my Fool colleague Brendon Lau pointed out on Monday, CBA “has the best balance sheet of the group (the other ASX banks)”. As he noted, this means CBA is in a better position to deliver higher dividends, and maybe even share buybacks, in the short to medium-term future.

Banking investors have probably noticed this over the past 3 months in particular. Thus, there might be some buying pressure stemming from here.

Finally, it’s worth taking into account the sale of CBA’s general insurance business to Hollard Group, which was set in motion last month. Commonwealth Bank will receive $625 million in cash upfront, with additional cash available “upon achieving certain business milestones”.

Will the good times roll for CBA shareholders?

After a very healthy 3 months, where to now for the CBA share price? Well, one broker who thinks the best may be behind CBA, at least for now, is investment bank, Goldman Sachs.

Goldman currently has a ‘sell’ rating on CBA shares, with a 12-month CBA share price target of $80.26. Goldman’s pessimism is one-dimensional — valuation concerns. The investment bank simply thinks CBA shares are priced too generously compared to its peers. Its $80.26 share price target implies a potential downside of 18.8% over the next 12 months.

At the current CBA share price, the ASX bank has a market capitalisation of $175.25 billion, a price-to-earnings (P/E) ratio of 22 and a trailing dividend yield of 2.51%.

The post The CBA share price has outperformed Westpac over the last 3 months appeared first on The Motley Fool Australia.

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• Broker warns that small lenders are set to beat ASX bank shares
• What to consider before investing in blue-chip ASX shares
• Humm (ASX:HUM) share price dips despite deal with Westpac NZ

Motley Fool contributor Sebastian Bowen 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 Bruce Jackson.

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The Sydney Airport Holdings Pty Ltd (ASX: SYD) share price will be in focus when trading resumes this morning. That’s because the company has formally rejected the takeover offer for 100% of its shares.

Shares in Australia’s largest airport ended yesterday’s session 0.51% lower at $7.80 after speculation emerged the board would reject the indicative offer.

Let’s take a closer look at today’s news.

Board says no

In a statement to the ASX, Sydney Airport advised it has turned down the offer from a consortium of infrastructure investors to buy 100% of its shares at $8.25 apiece.

The board says the offer “undervalues Sydney Airport and is not in the best interests of Securityholders.”

It gave the following reasons for rejecting the offer:

• The “irreplaceable nature” of Sydney Airport.
• Sydney Airport is a capitalised asset.
• The board believes the offer is “opportunistic” and is taking advantage of the COVID-19 pandemic. The offer is below the Sydney Airport share price pre-pandemic.
• The diversity of its revenue sources and “significant value” of the airport’s land assets.
• Anticipated stronger growth in a vaccinated, post-COVID world.

In its statement, the board says it “recognise(s)… the security price is likely to trade below the Consortium proposal’s indicative price in the short term…”

The original offer

When the bid by the consortium was submitted, the Sydney Airport share price rocketed almost 40% on the day.

The bid of $8.25 per share represented a premium of 42% to the closing price on the Friday before the submission. The bid included absorbing the $10 billion in debt held by Sydney Airport – making the total bid around $30 billion.

Sydney Airport share price snapshot

Over the past 12 months, the Sydney Airport share price has increased 46.5%.

While this has been driven mostly by the takeover bid, it has not been the only contributing factor. On the last trading day before the offer was sent, the company’s share price was already higher than when compared to one year prior.

Sydney Airport’s market capitalisation is approximately $21 billion.

The post Sydney Airport (ASX:SYD) share price on watch after takeover bid rejected appeared first on The Motley Fool Australia.

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• A2 Milk and Zip were among the most traded ASX shares last week
• Why the Sydney Airport (ASX:SYD) share price is flying higher today

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 Bruce Jackson.

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Respected fund manager Wilson Asset Management (WAM) has recently identified two ASX shares that it owns in its portfolio.

WAM operates several listed investment companies (LICs). Some focus on larger companies like WAM Leaders Ltd (ASX: WLE) and WAM Research Limited (ASX: WAX).

There’s also one called WAM Capital Limited (ASX: WAM) which targets “the most compelling undervalued growth opportunities in the Australian market.”

The WAM Capital portfolio has delivered an investment return of 16.6% per annum since inception in August 1999, before fees, expenses and taxes. This gross return outperformed the S&P/ASX All Ordinaries Accumulation Index return of 8.7% per annum over the same timeframe.

These are the two ASX shares that WAM Capital outlined in its most recent monthly update:

Johns Lyng Group Ltd (ASX: JLG)

WAM explains that Johns Lyng Group is a business that provides building and restoration services across Australia for properties and contents damaged by insurable events, including impact, weather and fire events. It has around 500 employees across Australia and operates in all major metropolitan areas and in high risk regional areas, like Far North Queensland.

The fund manager pointed out that in June, the company announced an upgrade to its earnings forecast, up from guidance given in February, of 10%, bringing earnings before interest, tax, depreciation and amortisation (EBITDA) to $52.1 million.

The increase was driven by strong demand for core services and catastrophe recovery services in New South Wales and southern Queensland.

WAM is still positive about its outlook, underpinned by a “strong” pipeline of work and balance sheet which can fund other acquisitions that would add to earnings. Three businesses have been acquired in the strata and building management sector after the year end.

According to Commsec, the Johns Lyng share price is valued at 39x FY22’s estimated earnings.

Seven West Media Ltd (ASX: SWM)

Seven West is another ASX share that WAM likes at the moment.

It’s described by the fund manager as Australia’s largest diversified media business. It produces content for various media forms including broadcast television, publishing and digital networks.

Seven West comprises the Seven Network and its affiliate channels, as well as The West Australia, The Sunday Times and Seven Studios.

In June, Seven West Media announced a “positive” fourth quarter trading update. WAM noted the ASX share reported advertising revenue growth of more than 45%, with this momentum expected to continue into the quarter ending 30 September 2021.

Seven West said 7plus saw a 62% increase in registered users in the year to date, above the market growth of 50.7%. Digital revenue was up 130% for FY21, with EBITDA of $60 million.

WAM is positive on the ASX share because its digital EBITDA is expected to more than double in FY22. There is also an ongoing focus on controlling costs. Seven West is seeing “strong” free cashflow generation which is contributing to de-leveraging of the balance sheet which the fund manager believes is being undervalued by investors. 

The post Wilson Asset Management (WAM) thinks these 2 ASX shares are a buy appeared first on The Motley Fool Australia.

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Motley Fool contributor Tristan Harrison 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 Bruce Jackson.

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Can you believe it? We’re already into the second half of 2021 — and August reporting season is only a fortnight away.

Financial results can see dramatic movements either way in ASX share prices. So it’s prudent to think about what adjustments you’d like to make to your portfolio before the fireworks arrive.

As such, Burman Invest chief investment officer Julia Lee nominated 3 ASX shares that are ripe for the taking before August.

Pathology is roaring back for Healius

“Looking at companies we expect to report quite strongly during reporting season, one of those that we like and have been adding to is Healius Ltd (ASX: HLS),” Lee told Switzer TV Investing.

Healius runs medical centres, pathology labs and imaging practices.

“The pathology part of the business has been bouncing back. So over the next 12 to 18 months, what you’re likely to see in pathology is higher margins and higher volumes coming through,” Lee said.

“But in the short-term, there’s a massive amount of COVID-19 testing that’s going on.”

Shares for Healius were trading at $4.75 on Wednesday afternoon. They’re up 26% for the year.

Will there be a higher bid for Sydney Airport?

Lee’s team has been adding to its position in Sydney Airport Holdings Pty Ltd (ASX: SYD).

The airport received a buyout offer last week from a consortium of superannuation funds that put in an indicative bid of $8.25 per share.

After shooting up that day from $5.81 to $7.78, Sydney Airport shares have held steady at that level while the market waits to see if others might be interested.

Some shareholders might be tempted to sell high before the air is clear on the acquisition potential. Lee prefers to wait.

“The general rule of thumb when it comes to any takeover is to buy on the first bid and hold on until it finishes,” she said.

“Especially with a quality asset like Sydney Airport… there are a lot of super funds as well as national funds which would be interested in these types of assets.”

Lee noted that the consortium priced the airport at pre-COVID valuation levels.

“These superannuation funds and national funds do take a long-term view of these assets,” she said.

“Sydney Airport I’d be holding on or even accumulating under that $7.70 mark, with potentially another bidder coming through here.”

Invest your wealth into a wealth management tool

Praemium Ltd (ASX: PPS) makes software for wealth management professionals.

Lee said that the tech company plays in a high-growing market segment.

“Praemium’s a really impressive company,” said.

“There’s a number of players that do participate in this area, Praemium’s one of them, [plus] Netwealth Group Ltd (ASX: NWL) and Hub24 Ltd (ASX: HUB).”

The fund manager noted Praemium had $34 billion funds under management at the end of 2020, but that had grown to $38 billion by the end of March.

“We’ve seen some strong growth numbers coming through, especially after the acquisition of Powerwrap and that’s likely to continue.”

Praemium shares jumped a whopping 17.5% on Wednesday to trade at $1.14 in the afternoon after it revealed a plan to divest international operations.

Even though Lee made her comments before this revelation, she still saw upside beyond Wednesday’s leap.

“Probably around that $1.20 to $1.30 mark is where I’d expect the shares to trade over the next 6 to 12 months. So certainly a bit of growth available there.”

The post 3 ASX shares to snap up before reporting season: expert appeared first on The Motley Fool Australia.

More reading

• Here are 3 of the most heavily traded ASX 200 shares today
• Sydney Airport (ASX:SYD) share price lower as board expected to reject takeover
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• Why the Praemium (ASX:PPS) share price is rocketing 21% higher today
• Here are the 5 best ASX fintech shares of the 2021 financial year

Motley Fool contributor Tony Yoo owns shares of Sydney Airport Holdings Limited. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of and has recommended Hub24 Ltd, Netwealth, and Praemium Limited. The Motley Fool Australia owns shares of and has recommended Netwealth. The Motley Fool Australia has recommended Hub24 Ltd and Praemium 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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For anyone wanting to pay for their next pint at the pub using Bitcoin (CRYPTO: BTC), things are looking promising.

A partnership between unlisted Australian start-up CryptoSpend and payment provider Visa Inc (NYSE: V) is set to make it all easier using standard point-of-sale terminals for the first time on the Visa network.

The revelation was unveiled in an interview published by Tuesday’s The Australian Financial Review.

CryptoSpend gets first tick from Visa

There have been other debit and credit payment options for paying with Bitcoin before. However, this marks the first one for any of the major international card schemes in Australia.

So, who managed to convince a US$517 billion company to provide the offering in Aus? It was the duo of Andrew Grech and Richard Voice at CryptoSpend. The two met through their studies at the University of Technology Sydney around 3 years ago.

According to the interview, the global payment provider took a close look under the bonnet to be comfortable with customer privacy, security, and anti-money laundering obligations being met.

The start-up is already operating with the new payments platform (NPP). This enables CryptoSpend users to instantly move Bitcoin funds into Australian bank accounts. As a result, current customers can pay bills and other people through the app.

However, co-founder Andrew Grech noted the drive for a debit spending card:

We have a lot of demand for the card. If the market is green, someone could say it’s time to spend some of my profits. On the other side of the fence, another person might say it’s going to keep going up, I’ll hold onto it. But we have seen more spending volume when the price is going up.

Making Bitcoin spending a reality

As well as partnering with Visa, CryptoSpend will be working alongside two other companies that will assist it in making the Bitcoin payment card possible.

Firstly, the cards themselves will be issued by Novatti Group Ltd (ASX: NOV). In addition, BitGo will be onboard as the custodian of cryptocurrency holdings. CryptoSpend is expected to launch the offering to users of its app in September.

While Bitcoin is the hallmark of the offering, the debit card will also make seamless payments possible with Ripple (CRYPTO: XRP), Bitcoin Cash (CRYPTO: BCH), and Ethereum (CRYPTO: ETH).

All of this is quite intriguing considering recent reports indicate 75% of Aussies think the Bitcoin bubble will burst.

The post Aussie startup set to launch first Bitcoin (CRYPTO:BTC) payment card with Visa appeared first on The Motley Fool Australia.

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Motley Fool contributor Mitchell Lawler owns Bitcoin and Ethereum. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of and has recommended Bitcoin and Visa. 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 Bruce Jackson.

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The Zip Co Ltd (ASX: Z1P) share price was one of the worst performers on the S&P/ASX 200 Index (ASX: XJO) on Wednesday.

The buy now pay later (BNPL) provider’s shares ended the day over 11% lower at $7.32.

This was the worst daily performance by the Zip share price since 17 February.

Why did the Zip share price sink?

Investors were heading to the exits in a hurry yesterday amid reports that tech behemoth Apple is planning to enter the BNPL market.

As I wrote here, Bloomberg is reporting that Apple is planning to launch a new offering, Apple Pay Later, with support from Goldman Sachs.

While Apple has declined to comment on the speculation, Bloomberg has reportedly spoken with people involved in the development of the product. It understands that the service will be have similarities to the offerings of both Afterpay Ltd (ASX: APT) and Zip.

Apple Pay Later is expected to allow consumers to buy items in store and online with an interest-free Apple Pay in 4 option and a longer-term option with interest called Apple Pay Monthly Instalments.

Why enter BNPL?

The report explains that Apple is interested in entering the BNPL market to help increase Apple Pay adoption. As Apple takes a cut from transactions made with Apple Pay, increased use would be a boost to its US$50 billion per year services business.

It wasn’t just the Zip share price sinking on Wednesday. Given that this news has potential ramifications for the whole industry, it will come as no surprise to learn that Affirm, Afterpay, and Sezzle Inc (ASX: SZL) shares also tumbled significantly lower.

Also weighing on the Zip share price yesterday was news that PayPal is removing late fees for its BNPL service. While nowhere near as unexpected as Apple’s news, it highlights just how competitive the landscape is getting in the lucrative market.

One positive, though, is that despite yesterday’s decline, the Zip share price is still up 31% year to date.

The post The Zip (ASX:Z1P) share price just had its worst day since 17 February. Here’s why appeared first on The Motley Fool Australia.

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Motley Fool contributor 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 and has recommended AFTERPAY T FPO and ZIPCOLTD FPO. The Motley Fool Australia owns shares of and has recommended AFTERPAY T FPO. 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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The Adore Beauty Group Ltd (ASX: ABY) share price might be one to think about after its volatility over the last three months.

Adore Beauty is an e-commerce beauty business. It sells over 260 brands with 10,800 products.

Recent Adore Beauty share price movement

If you look at the Adore Beauty share price over the last three months, it hasn’t much that much. But it dropped all the way to around $3.30 in the middle of May and has since climbed around 55% to be at the current share price.

Trading update

A couple of months ago, it released its FY21 third quarter trading update. In the update, it said that revenue was up 47% to $39.4 million.

Active customers at the end of the third quarter had reached 687,000 – this was an increase of 69%.

Adore Beauty boasted that it has been seeing strong retention and re-engagement rates for new customers acquired during the COVID-19 period.

The e-commerce business said that it’s on track to achieve full year FY21 revenue growth of between 43% to 47% year on year.

Adore Beauty is continuing to pursue disciplined investment to drive revenue growth and further expand its online leadership position. Management advised the FY21 earnings before interest, tax, depreciation and amortisation (EBITDA) will reflect the company’s continued investment, including in marketing and advertising, as well as the cost of increased staff levels.

Management believe that the company continues to grow its market share, but it wants more. It wants to improve its range and believes there are adjacency expansion opportunities. Adore Beauty is also working on private label development.

The potential opportunity for Adore Beauty?

Adore Beauty says the beauty and personal care market in Australia is worth $11.2 billion and is expected to grow at a compound annual growth rate of 26% to 2024.

Online sales make up 11.4% of the beauty and personal care market. The Australian digital penetration rate is lower compared to countries like the US, the UK and China.

Due to the size of that potential opportunity, Adore Beauty plans to invest to grow its market share by increasing brand awareness, winning new customers and improving customer retention.

Management are expecting higher profit margins over time:

Given the predominately fixed nature of the business’ cost base, management expects scale benefits to increase operating leverage and deliver EBITDA margin expansion in the longer term as the company continues to grow revenue.

Is the Adore Beauty share price an opportunity?

The broker UBS rates the Adore Beauty share price as a buy with a price target of $5.60.

Whilst UBS notes an e-commerce slowdown in the short-term, it believes that online beauty is a good growth trend for Adore Beauty in the long run. The company can invest in advertising and see customer loyalty improve over time.

It is expecting Adore Beauty to be able to generate over $360 million of sales in FY25.

If UBS is right with its priec target, then the Adore Beauty share price might go up just under 10% over the next 12 months.

The post Is the Adore Beauty (ASX:ABY) share price a buy? appeared first on The Motley Fool Australia.

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Motley Fool contributor Tristan Harrison has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has recommended Adore Beauty Group Limited. 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 Bruce Jackson.

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If you’re looking to boost your income with some dividend shares, then you might want to consider the ones listed below.

Here’s why analysts have given them buy ratings:

National Storage REIT (ASX: NSR)

The first ASX dividend share to look at is National Storage. It is one of the largest self-storage operators in the ANZ region with a network of over 200 centres.

Though, it looks unlikely to stop at that number. National Storage recently raised $326 million to strengthen its balance sheet and replenish its investment capacity. This could mean further earnings accretive acquisitions in the highly fragmented market in the future.

Combined with favourable trading conditions being driven by the booming housing market, this bodes well for the coming years.

Analysts at Ord Minnett currently have an accumulate rating and $2.20 price target on the company’s shares. Its analysts are also forecasting dividends of 8.2 cents per share in FY 2021 and then 8.6 cents per share in FY 2022. Based on the latest National Storage share price of $2.10, this will mean yields of 3.7% and 4.1%, respectively.

Transurban Group (ASX: TCL)

Another ASX dividend share to consider is Transurban. It is one of the world’s leading toll road operators with key roads in Melbourne, Sydney and Brisbane, as well as in Greater Washington, United States and Montreal, Canada.

In addition to being a toll road company, Transurban considers itself to be a technology company. It notes that it researches and develops innovative tolling and transport technology that makes travel easier for everyone.

Recent lockdowns have certainly been a blow to the company. However, as has been proven previously during the pandemic, traffic bounces back reasonably quickly once restrictions ease. And with the Australian vaccine rollout starting to gather momentum, it may not be too long until lockdowns are a thing of the past and its roads are busy with traffic again.

This could make it worth being patient with Transurban’s shares. Especially given the prospect of big dividend increases in the future.

Macquarie is confident in the company’s recovery and is expecting its distributions to rebound strongly in FY 2022. The broker is forecasting dividends of 36 cents per share in FY 2021 and then 59.1 cents per share in FY 2022. Based on the latest Transurban share price of $14.76, this will mean yields of 2.4% and 4%, respectively, over the next two years. Macquarie currently has an outperform rating and $15.20 price target on the company’s shares.

The post 2 buy-rated ASX dividend shares appeared first on The Motley Fool Australia.

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Motley Fool contributor James Mickleboro 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 Bruce Jackson.

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It’s been a good week for the BHP Group Ltd (ASX: BHP) share price. Shares in the Aussie mining giant are up 3.4% since Friday’s close, translating to a $149.4 billion market capitalisation.

Here’s why shares in the iron ore miner are enjoying solid gains at the moment.

Why the BHP share price has surged higher this week

In good news for shareholders, the Aussie mining share continues to hover just shy of its $51.82 per share record high.

The most recent run started on Monday as the BHP share price rocketed higher to start the week. Pleasingly for shareholders, those gains have largely been maintained including a 0.5% gain on Thursday.

One key regulatory change from China’s central bank has been a factor boosting BHP’s fortunes in recent days. As noted in the Australian Financial Review on Monday, the People’s Bank of China announced a change in bank reserve requirements which could free up hundreds of billions of additional liquidity in the Chinese economy.

That helped spark share price rallies in global markets last Friday with resources shares being particular winners. The BHP share price, alongside fellow iron ore giants Fortescue Metals Group Limited (ASX: FMG) and Rio Tinto Ltd (ASX: RIO), followed suit and surged when markets reopened on Monday.

Crude oil prices have also been climbing, aided by declining inventories and increasing tensions amongst the OPEC oil cartel. Both Brent and WTI crude prices climbed higher and sparked a surge in BHP shares on Monday. According to its 2020 annual report, BHP generated US$4.1 billion or 9.5% of its revenue from petroleum in FY2020.

That means the company has exposure to climbing commodity prices through potentially higher realised sale prices in significant volumes.

The BHP share price is sitting just 1.7% from its all-time high. That’s not bad for an S&P/ASX 200 Index (ASX: XJO) share hit hard in the March 2020 bear market.

The post Why the BHP (ASX:BHP) share price has surged 3% this week appeared first on The Motley Fool Australia.

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Motley Fool contributor Ken Hall 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 Bruce Jackson.

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The Afterpay Ltd (ASX: APT) share price just had its worst day since February 2021, falling by around 9.6%.

Afterpay wasn’t the only one that suffered a big sell off on Wednesday. The Zip Co Ltd (ASX: Z1P) share price also declined by around 11.4%. The Sezzle Inc (ASX: SZL) share price fell a little less than that, dropping by approximately 10.3%.

Apple Pay Later

It is being reported by Bloomberg that Apple and Goldman Sachs are planning to launch a buy now, pay later service that could be a rival to operators like Affirm as well as Afterpay.

Bloomberg said that Apple is working on a service that is internally known as Apple Pay Later. It will mean that consumers can use Apple Pay for any purchase in instalments over a certain amount of time.

It won’t be Apple as the lender of the loans, but Goldman Sachs. The two US giants have already been partners with the Apple Card credit card for the last couple of years. But, according to Bloomberg, consumers won’t need an Apple Card for the purchases.

What would Apple get out of this? It is reportedly hoped that it would increase the adoption of Apple Pay and lead to more consumers using the iPhone to pay for things instead of their normal payment card. Apple makes money from transactions paid with Apple Pay.

Bloomberg reports that a consumer using Apple Pay Later can either pay for it interest-free across four payments every fortnight, or over a few months with interest.

This will be reportedly available for both in-store and online purchases.

People that want to use this Apple Pay Later service will need to be approved through an iPhone Wallet app application with ID.

Some of these payment plans will exclude late fees and processing fees. It also won’t require running a credit check on users, according to Bloomberg.

At this stage, this new service is still in development. The final product could have changes. 

Afterpay share price volatility

Investors also learned that PayPal wouldn’t be charging late fees. 

Despite the heavy decline on Wednesday, the Afterpay share price is still up around 24% over the last two months.

But it has dropped by approximately 33% since the high in February 2021 before it reported its FY21 half-year result.

The post The Afterpay share price just had its worst day since February 2021. Here’s why appeared first on The Motley Fool Australia.

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• ASX 200 rises, Afterpay sinks, Macquarie Telecom soars
• BNPL ASX share prices tumble as PayPal declares no BNPL late fees
• Why ASX BNPL shares like Afterpay, Zip, and Sezzle are sinking

Motley Fool contributor Tristan Harrison 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 AFTERPAY T FPO and ZIPCOLTD FPO. The Motley Fool Australia owns shares of and has recommended AFTERPAY T FPO. 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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