AFRM - Affirm Holdings: Strong Growth Ahead - Play The Long Game

2024-04-06 10:00:00 ET

Summary

• AFRM is more attractive after the recent pullback, as the market also waits for the fintech to slowly grow into its premium valuations.
• FY2024 is set to bring forth the first year of adj operating profitability as the management focuses on healthy consumer and loan portfolio growth.
• With relatively reasonable delinquency rates compared to its peers and major credit card lenders, it appears that AFRM's BNPL platform has worked as intended.
• With the Fed pricing in three rate cuts in 2024, there may be some pressure in its profit spread, albeit potentially balanced by rising loan originations as borrowing costs moderate.
• Here is where we believe there is immense opportunities for investors with higher risk tolerance, since the stock appears to be well supported at current levels.

We previously covered Affirm (NASDAQ: AFRM ) in January 2024, downgrading the stock to a Hold, due to the overly optimistic rally by +175.9% since the October 2023 bottom....

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