Are Meme Stocks Back? Jim Cramer Says This Stock Is GameStop 'With Profits'

Affirm Holdings Inc AFRM shares have doubled over the last month. The outsized move is being driven by retail investors, according to Jim Cramer.

What To Know: Affirm shares are up approximately 100% over the last month and more than 420% since the start of the year. The stock closed up another 15% on Tuesday after the company announced it had expanded its payment services to self-checkout in Walmart Inc WMT stores.

Wednesday on CNBC's "Squawk On The Street," Cramer featured Affirm in his "Mad Dash" segment. 

He attributed the stock's recent surge to increased retail interest and compared it to the original meme stock GameStop Corp GME.

Affirm is just GameStop with profits, Cramer said, noting that the stock has been "memeified." Retail traders are targeting the stock because of its high short interest, he added. 25.34% of Affirm's float is currently sold short, according to data from Benzinga Pro.

Many thought that loan delinquencies could be a big problem for Affirm, but the company turned out to not have many bad loans, Cramer said. It was also feared that rising rates would negatively impact Affirm's business, but the Federal Reserve recently signaled that rate cuts could be coming, which has helped fuel some of the recent move, he added. 

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"The next thing you know they're cutting rates, they have very few bad loans and Walmart — they already had that deal — but that's the kind of thing where the memesters say ... 'wow,'" Cramer said. 

On Wednesday, Mizuho released a new note on Affirm, raising its price target from $30 to $65, Cramer said, noting that it didn't matter what was in the note because the memesters were going to focus on the price target increase.

Retail traders have used the recent string of positives to drive the stock higher, Cramer said, and he suggested the stock's resurgence is largely due to retail trying to induce a short squeeze like what occurred with GameStop.

AFRM Price Action: Affirm shares were down 8.62% at $46.11 at the time of publication, according to Benzinga Pro.

Photo: Owen Byrne from Flickr.