While Zip is yet to indicate a deterioration in its business, Zip shares have suffered a dizzying 84% fall so far this year. We feel they are the most vulnerable to an earnings downgrade cycle. We are very cautious on consumer discretionary companies, companies leveraged to the housing market or financials. Portfolio manager for Ophir Asset Management Andrew Mitchell recently spoke to The Australian on the topic of inflation and shares, stating: The outlook presents challenges in a tough economic environment.įurthermore, Garipoli is not alone in his caution toward ASX shares tied to discretionary consumer spending. Providing his perspective on the BNPL company in a recent post on The Bull, Garipoli said: Send large files via email or simply create a share link. Seneca Financial Solutions senior investment advisor Arthur Garipoli believes Zip shares are a sell amid the rising rates. Send and share files and other large documents thanks to our fast and secure file transfer solution. In turn, retail-focused ASX shares - such as Zip - could see diminished enthusiasm as investors stay mindful of this headwind. That means the RBA is actively trying to dampen consumer sentiment. The persistent rate rises are being made in a bid to stifle inflation as consumer purchasing power continues to be eroded. Such a decision would take Australia’s target cash rate to 2.85%, the highest it will have been since June 2013. Once again, the Fed opted to jack up interest rates by 0.75% - taking the headline rate range to between 3% and 3.25%.įollowing the call, some economists are forecasting our local central bank - the Reserve Bank of Australia (RBA) - will lift rates by 0.5% in October.
Last week, the United States Federal Reserve announced yet another rate hike. Tightening the beltīefore we get into the nitty-gritty on Zip, let’s zoom out to the macroeconomic level. ZippyYum remains nimble and cutting-edge and now benefits from Avery. The platform was developed by a veteran team of restaurant owner-operators and became part of the Avery Dennison family in 2021. At the time of writing, the S&P/ASX 200 Index (ASX: XJO) is off-kilter by 1.33% although it’s been down more than 2% this morning.īut let’s take a look at where Zip shares could be heading on a longer time horizon. ZippyYum’s award-winning platform of native mobile apps has been revolutionizing inventory, food safety, and operations management since 2011. Though, the bigger picture potential for this ASX buy now, pay later (BNPL) share could be unflattering.Īmid the broad and heavy selling, Zip shares are currently down holding their ground at 69 cents apiece, the same as Friday’s closing price.įor comparison, the benchmark index is suffering its third consecutive day of nosediving. The Zip Co Ltd ( ASX: ZIP) share price is avoiding the worst of a brutal sell-off today.
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