Buy now, pay later player Affirm Holdings, Inc (NASDAQ: AFRM) chief Max Levchin claims to have beaten rivals like Klarna Bank AB, Bloomberg cites from an interview Thursday.
Levchin projected bullish prospects for the BNPL firms, citing current consumer shopping trends. Affirm stock is up close to 6% on Friday.
Affirm, on Wednesday, reported fourth-quarter topline growth of 47.8% to $659 million, beating the analyst consensus. The company narrowed its net loss to ($45) million, down from ($206) million a year ago.
It expects to be profitable by the fiscal fourth quarter of 2025. Revenue at Affirm climbed 49% in the first half of 2024, compared with a 27% growth at Klarna. Klarna posted a breakeven second-quarter quarter on a net income basis.
Buy now, pay later firms are currently under a regulatory compliance grace period, during which the regulator requires them to investigate disputes, refund returned products, and provide billing statements.
JPMorgan analyst Reginald Smith, ahead of Affirm's fourth-quarter print, hailed it as a top fintech pick, backed by multi-year volume, revenue growth, and margin expansion opportunity.
The global BNPL market will likely grow from $30.38 billion in 2023 to $37.19 billion in 2024 to $ 167.58 billion by 2032, implying a CAGR of 20.7%.
Affirm Holdings stock gained 108% in the last 12 months.
Affirm Stock Prediction For 2024
Equity research analysts on and off Wall Street typically use earnings growth and fundamental research as a form of valuation and forecasting. But many in trading turn to technical analysis as a way to form predictive models for share price trajectory.
Some investors look to trends to help forecast where they believe a stock could trade at a certain point in the future. Looking at Affirm, an investor could make an assessment about a stock's long term prospects using a moving average and trend line.
If they believe a stock will remain above the moving average, which many believe is a bullish signal, they can extrapolate that trend into the future using a trend line. For Affirm, the 200-day moving average sits at $34.79, according to Benzinga Pro, which is below the current price of $43.64. For more on charts and trend lines, see a description here.
Traders believe that when a stock is above its moving average, it is a generally bullish signal, and when it crosses below, it is a more negative signal. Investors could use trend lines to make an educated guess about where a stock could trade at a later date if conditions remain stable.
Price Action: AFRM stock is up 6.55% at $44.39 at the last check on Friday.