- Affirm Holdings ( NASDAQ: AFRM ) stock sank 6.3% in Monday trading as the Buy Now, Pay Later financing company continued its downward trajectory as the cost of financing rises and fears of a recession increase.
- The stock has been a volatile one, and partly rides the trends of risk-on or risk-off sentiment. Also as a company that hasn't yet weathered a recession, investors may be wary of its ability to manage well through difficult times. In addition, U.S. retail sales fell more than expected in November, during prime holiday shopping seasons.
- Last week the Federal Reserve raised its policy rate by 50 basis points to 4.25%-4.50%, its highest level since 2007. The higher interest rates leads to increased costs for borrowing money, both for consumers and business, leaving investors worried that the tighter policy will tip the U.S. economy into recession.
- Affirm ( AFRM ) was founded in 2012 and went public via IPO in January 2021.
- Last week BofA Securities analyst Jason Kupferberg downgraded Affirm ( AFRM ), Discover Financial ( DFS ), Synchrony Financial ( SYF ) due to weakening conditions for consumers.
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Affirm Holdings stock slides as financing costs rise, recession fears increase