Analyst Note| Shaun Ler |
No-moat buy now, pay later, or BNPL, provider Afterpay’s third quarter fiscal 2021 saw stellar growth in financed sales, active customers and merchants of 104%, 75% and 77%, respectively, from the prior corresponding period. North America impressed with 1) U.S. financed sales in March 2021 exceeding AUD 1 billion; and 2) helping March quarter sales surpass the seasonally strong December quarter on a USD basis. Our fair value estimate stays AUD 75 per share as we had already expected Afterpay to report very strong sales growth of just over 100% in fiscal 2021. We expect this to moderate to 30% by fiscal 2025 though as the product matures.