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    Should Best Buy Store Rollout Require Action From Zip (ASX:ZIP) Investors?

    Simply Wall St·10/29/2026 01:21:12
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    • Zip Co Limited previously announced a nationwide rollout of its Best Buy partnership into physical stores, allowing eligible US shoppers to use Zip tap to pay in store, alongside an existing online presence and a base of 32,600 US merchant partners and 4.7 million active US customers.
    • The move aligns Zip Co’s product with a clear shift toward in person usage. In First Quarter Fiscal Year 27, US in store transactions represented 30% of domestic volume, with reported transaction volume growth of 61% year on year.
    • We will now examine how Zip Co’s investment narrative could be influenced by this broader Best Buy store rollout and rising in store usage.

    Scan how Zip Co’s in store momentum compares with other consumer finance players by reviewing our hand picked list of 6 resilient stocks with low risk scores.

    Zip Co Investment Narrative Recap

    To own Zip Co, you need to believe the business can keep turning app based usage into broader payment habits across both online and in person channels, while controlling credit losses and funding costs. The Best Buy rollout speaks directly to that thesis by putting Zip inside a high traffic electronics chain, although the impact on overall volumes and margins will only become clear over coming quarters.

    In the very near term, the key catalyst is Q1 FY27 results on 23 October, which will show how U.S. growth, in store mix and bad debts are tracking. The biggest risk remains execution in the U.S. where lower margins, heavier competition and reliance on wholesale funding could pressure profitability if credit performance or transaction trends soften.

    The leadership change in the U.S. is the most relevant recent announcement. Joe Heck has resigned as Zip U.S. CEO and Rory Herriman, formerly U.S. Chief Technology and Operations Officer, has stepped in as President and interim CEO, with Group CEO Cynthia Scott closely involved in the transition. That matters because the U.S. now contributes most of Zip Co revenue.

    Investors will likely watch how Herriman handles the Best Buy rollout, broader merchant relationships and underwriting discipline while managing cost of funds and product mix. Execution stability around this leadership shift is directly linked to the same near term catalysts as the Best Buy expansion, especially transaction volume trends, credit quality, and whether U.S. economics support Zip Co’s group margin targets.

    Zip Co's current earnings are A$116.4 million and analysts collectively project A$272.7 million of earnings on A$2.1b of revenue by 2029. This implies forecast revenue growth of 16.9% per year and an earnings increase of about 2.3x from today.

    Uncover why Zip Co's fair value indicates a 131% potential upside to its current price before that discount gap narrows.

    ASX:ZIP 1-Year Stock Price Chart
    ASX:ZIP 1-Year Stock Price Chart

    Exploring Other Perspectives

    One alternate view focuses less on the Best Buy rollout and more on interest costs. The most bearish Zip Co analysts were assuming earnings of about A$244.9 million on A$2.2b of revenue by 2029, which is well below the top end of forecasts. That gap shows how sharply expectations can differ, and it may shift once this in store news is fully reflected.

    Explore 5 other Zip Co fair value estimates, including one that suggests it could be worth just A$2.55!

    Reach Your Own Conclusion

    Don't just follow the ticker. Dig into the data and build a conviction that's truly your own.

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