Xero shares finally overhaul peak reached in 2014

Thursday, 7 June 2018

Founder Rod Drury's stake in Xero is now worth $857 million.

Xero shares have hit an all-time high, topping the previous peak of $45.99 they reached during a frenetic day's trading on the New Zealand stock exchange in March 2014.

The company's shares hit a new peak of A$44.20 (NZ$48.17) on the Australian stock market where they are now listed, on Wednesday, and closed at A$43.61 (NZ$47.52).

The jump means anyone who invested $10,000 in Xero's initial public offering in 2007, and who hung on for the ride, would be sitting on an investment worth $475,200.

Xero is now worth just over A$6b (NZ$$6.6b), still a little behind New Zealand's stock market leaders which are currently led by Fisher & Paykel Healthcare with its market value of just over $8.2b.

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Xero founder Rod Drury cashed up $95m from his holding in Xero in November but retains a 13 per cent stake in the business, now worth $857m.

Britain has overtaken New Zealand to become Xero's second largest market, by customers, after Australia.

The spike in Xero's share value early in 2014 followed a $150m capital raising the previous October – mostly from US investors which included Valar Ventures, backed by controversial US investor Peter Thiel, and Matrix Capital Management.

That was followed by a few years during which Xero shares dipped to mostly trade under $20, on the growing realisation that the US market would be a tough nut for the company to crack.

The Wellington-registered company, which is now headed by Sydney-based Australian chief executive Steve Vamos, changed its tagline from 'beautiful accounting software' to 'beautiful business' on Wednesday.

The branding change is designed to emphasise it now offers a wider service, beyond its core business of cloud-based accounting software.

United States accounting software giant Intuit has also enjoyed a remarkable sharemarket run this year, with its market value rising by a third to hit a new all-time high on Thursday morning of US$53b (NZ$75b).

Xero is currently holding its annual North American conference in Atlanta, which has attracted about 800 accountants and partners.

The company announced a new partnership with financial services giant Citi and new product features, including one which means businesses don't need to rekey information from bills that are received in PDF format through Xero's platform when doing their own accounts.

'It is these kinds of capabilities working seamlessly together that enables small businesses to pursue their passion, be successful and do beautiful business,' vice president of product and partnerships Herman Man said in a statement.