Sezzle (NASDAQ:SEZL) Shares Gap Down - Here's Why

Key Points

• Sezzle's stock price fell significantly, opening at $103.51 after previously closing at $139.33, with shares last trading at $96.71.
• The company received a downgrade from Wall Street Zen, lowering its rating from "strong-buy" to "buy," while Oppenheimer raised its target price from $168.00 to $202.00.
• Institutional investors have shown increased activity, with several firms greatly expanding their stakes in Sezzle during recent quarters, including Bank of New York Mellon Corp growing its position by 518%.

Sezzle Inc. (NASDAQ:SEZL - Get Free Report)'s stock price gapped down before the market opened on Friday . The stock had previously closed at $139.33, but opened at $103.51. Sezzle shares last traded at $96.71, with a volume of 2,074,425 shares traded.

Wall Street Analyst Weigh In

Several research firms have recently weighed in on SEZL. B. Riley lifted their target price on Sezzle from $101.00 to $111.00 and gave the stock a "buy" rating in a research report on Monday. Oppenheimer lifted their target price on Sezzle from $168.00 to $202.00 and gave the stock an "outperform" rating in a research report on Wednesday, July 2nd. Finally, Wall Street Zen downgraded Sezzle from a "strong-buy" rating to a "buy" rating in a research report on Thursday, May 22nd.

Sezzle Price Performance

The company has a debt-to-equity ratio of 0.56, a current ratio of 2.62 and a quick ratio of 2.62. The firm has a fifty day moving average of $144.83 and a two-hundred day moving average of $85.53. The stock has a market capitalization of $2.87 billion, a P/E ratio of 29.76 and a beta of 9.09.

Sezzle (NASDAQ:SEZL - Get Free Report) last released its quarterly earnings data on Thursday, August 7th. The company reported $0.69 earnings per share for the quarter, beating the consensus estimate of $0.58 by $0.11. The firm had revenue of $60.31 million during the quarter, compared to the consensus estimate of $93.33 million. Sezzle had a return on equity of 113.81% and a net margin of 28.13%. On average, analysts predict that Sezzle Inc. will post 9.77 EPS for the current year.

Insider Activity at Sezzle

In related news, COO Amin Sabzivand sold 6,028 shares of Sezzle stock in a transaction dated Friday, June 27th. The stock was sold at an average price of $164.23, for a total value of $989,978.44. Following the completion of the sale, the chief operating officer directly owned 243,303 shares in the company, valued at $39,957,651.69. The trade was a 2.42% decrease in their ownership of the stock. The transaction was disclosed in a legal filing with the SEC, which is available through the SEC website. Also, CFO Karen Hartje sold 5,484 shares of Sezzle stock in a transaction dated Monday, July 7th. The shares were sold at an average price of $168.02, for a total value of $921,421.68. Following the completion of the sale, the chief financial officer owned 126,846 shares of the company's stock, valued at $21,312,664.92. The trade was a 4.14% decrease in their ownership of the stock. The disclosure for this sale can be found here. Insiders sold 77,696 shares of company stock worth $11,552,835 over the last three months. 49.49% of the stock is owned by corporate insiders.

Institutional Trading of Sezzle

Institutional investors and hedge funds have recently made changes to their positions in the company. BNP PARIBAS ASSET MANAGEMENT Holding S.A. bought a new position in Sezzle in the second quarter worth about $29,000. Spire Wealth Management bought a new position in Sezzle in the second quarter worth about $32,000. Farther Finance Advisors LLC bought a new position in Sezzle in the second quarter worth about $33,000. CWM LLC raised its holdings in Sezzle by 49,400.0% in the first quarter. CWM LLC now owns 990 shares of the company's stock worth $35,000 after purchasing an additional 988 shares in the last quarter. Finally, Federated Hermes Inc. grew its stake in shares of Sezzle by 3,575.0% during the fourth quarter. Federated Hermes Inc. now owns 147 shares of the company's stock worth $38,000 after acquiring an additional 143 shares during the last quarter. 2.02% of the stock is currently owned by institutional investors.

About Sezzle

Sezzle Inc operates as a technology-enabled payments company primarily in the United States and Canada. The company provides payment solution in-store and at online retail stores; and through proprietary payments solution that connects consumers with merchants. It also offers Sezzle Platform that provides a payments solution for consumers that extends credit at the point-of-sale allowing consumers to purchase and receive the ordered merchandise at the time of sale while paying in installments over time; Pay-in-Four, which allows consumers to pay a fourth of the purchase price up front and then another fourth of the purchase price every two weeks thereafter over a total of six weeks; Pay-in-Full that allows consumers to pay for the full value of their order up-front through the Sezzle Platform without the extension of credit; and Pay-in-Two and other alternative installment options, which allow consumer to pay half of the value of their order up-front and the second half in two weeks.