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Corporation
INTERNET | Internet Software & Services / Accounting & Finance
xero.com

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Founded Year

2006

Stage

PIPE - V | IPO

Market Cap

21.19B

About Xero

Xero is an online accounting system designed for small businesses and their advisors. Clients are able to customize their Xero accounting software experience with specialized software for their business, as well as build their own stack of integrated apps that work with Xero.

Xero Headquarter Location

19-23 Taranaki Street

Wellington, 6011,

New Zealand

Latest Xero News

3 reasons why the Xero (ASX:XRO) share price could be a high-quality buy

Dec 4, 2021

Xero shares could be a high-quality pick to consider. Tristan Harrison has been a contributor to The Motley Fool since October 2016. He has an advanced diploma from the Association of Accounting Technicians (UK) and is currently studying to be a Chartered Institute Management Accountant. Tristan's goal is to help Australians learn about the great businesses listed on the ASX that will help grow their portfolio, wealth and confidence about investments over the long term. He's a keen tennis fan and can't wait for the next Australian Open to roll around. You can view Tristan's holdings here . Latest posts by Tristan Harrison ( see all ) Image source: Getty Images The Xero Limited (ASX: XRO) share price could be a top contender to consider for growth investment portfolios right now. Xero has a claim to be one of the leading cloud accounting software businesses in the world. It already has strong market positions in New Zealand, Australia and the UK as it wins more subscribers in those areas. The business also has rapidly growing numbers in countries like South Africa and Singapore. The business has a number of different compelling reasons to consider it. Here are three factors to like the business: Cheaper price If investors are considering a particular business, then a cheaper price is more attractive than an expensive one. Since 1 November 2021, the Xero share price has dropped more than 8%. That’s materially cheaper for the business for people to get a slice of. The lower price may not be there forever if Xero continues to increase in size. At the moment, Xero shares are rated as a buy by Citi, with a price target of $160. A price target is where the broker thinks the share price will be trading in a year from now. That implies the broker thinks that the Xero share price could go up more than 10% over the next year. Software as a service (SaaS) economics SaaS is simply where a tech business is providing a service, usually with a recurring monthly or annual model. That can be useful for customer retention, predictable cashflow and higher profit margins. Xero has a very high gross profit margin of 87.1%. It was 85.7% in the first half of FY21 and 82.8% in the first half of FY19. Customer churn is very low and is going lower – in the first half of FY22 it was 0.88%. The increasing average revenue per user (ARPU) and lowering churn is helping increase the lifetime value (LTV) of its total subscriber base. In HY22, Xero said it added $3.8 billion to its LTV to $9.9 billion. Xero’s annualised monthly recurring revenue climbed another 29% to NZ$1.13 billion during HY22, which may give a rough guide of what the next 12 months of revenue may be if it didn’t gain any more subscribers. Global platform ecosystem One of the main features of Xero is that it enables small and medium businesses to access a range of additional applications and services. This makes the overall Xero offering more useful and valuable to those subscribers. This could be helpful for the Xero share price in the long run. Platform revenue is becoming an increasingly important part of the picture. In HY22, platform revenue made up 11% of the total NZ$506 million revenue – this was after 104% year or year growth, or 37% growth excluding acquired businesses. Accounting software revenue increased 18% year on year in the same time period. The Xero App Store is the next focus as it moves towards a more commercial model. Should you invest $1,000 in Xero right now? Before you consider Xero, you'll want to hear this. Motley Fool Investing expert Scott Phillips just revealed what he believes are the 5 best stocks for investors to buy right now... and Xero wasn't one of them. The online investing service he’s run for nearly a decade, Motley Fool Share Advisor, has provided thousands of paying members with stock picks that have doubled, tripled or even more. * And right now, Scott thinks there are 5 stocks that are better buys.

Predict your next investment

The CB Insights tech market intelligence platform analyzes millions of data points on venture capital, startups, patents , partnerships and news mentions to help you see tomorrow's opportunities, today.

Research containing Xero

Get data-driven expert analysis from the CB Insights Intelligence Unit.

CB Insights Intelligence Analysts have mentioned Xero in 1 CB Insights research brief, most recently on Sep 22, 2020.

Expert Collections containing Xero

Expert Collections are analyst-curated lists that highlight the companies you need to know in the most important technology spaces.

Xero is included in 3 Expert Collections, including SMB Fintech.

S

SMB Fintech

1,145 items

C

Conference Exhibitors

5,302 items

F

Fintech

3,198 items

Excludes US-based companies

Xero Patents

Xero has filed 23 patents.

The 3 most popular patent topics include:

  • Data management
  • Payment systems
  • Machine learning
patents chart

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Grant Date

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2/21/2019

8/10/2021

Payment systems, Banking technology, Banking, Information technology management, Accounting terminology

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Payment systems, Banking technology, Banking, Information technology management, Accounting terminology

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Xero Web Traffic

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Page Views per User (PVPU)
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Reach per Million (RPM)
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Xero Rank

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