You've probably never heard of it, but the Wizr Ltd (ASX: WZR) share price has now quadrupled in 2019 and is up 28% today on the back of no apparent news being released to the market. However, last week it was reportedly tipped as a 'buy' (well below today's price) by an investing newsletter similar to The Motley Fool.
According to its latest regulatory 3B filing, Wizr has 777.7 million shares on issue to give it a market cap of $140 million based on today's record share price high of 18 cents.
According to its website Wizr is a fintech player in the Australian consumer finance market in that it lends sums up to $50,000 to individuals for "any worthwhile purpose" at better interest rates available elsewhere.
Generally for example the big banks like Commonwealth Bank of Australia (ASX: CBA) won't lend large amounts unsecured to consumers outside credit card limits, as they know there's a large chance they won't get their money back.
Wizr reports that sometimes it will require security against its loans and also offers other financial products and services to customers.
Wizr's quarterly statements of cash flows are also not conventional, although it reports that it orginated $18.8 million of loans over the quarter to March 31 2019. However, it's not profitable and only had $1.8 million cash on hand at quarter end.
Fintech disruption in the consumer finance space via the likes of AfterPay Touch Group Ltd (ASX: APT) is a white hot space on the market right now and Wizr's business model in the consumer finance probably explains the share price rises more than the cash flows. As such I'm not a buyer of Wizr shares.
Elsewhere consumer and SME finance lender Prospr is tipped to hit the ASX boards soon at a valuation around $750 million.
While below The Motley Fool reveals for free two businesses I personally believe could be the best bets of all in the hot fintech sector….
