Affirm Holdings Boosts Profits Despite Choppy Macro: 5 Of 6 Analysts Revise Forecasts Post-FQ1

Shares of Affirm Holdings Inc AFRM were rallying on Thursday, along with some other popular stocks.

The results came amid an exciting earnings season. Here are some key analyst takeaways from the earnings release.

Truist Securities On Affirm Holdings

Analyst Andrew Jeffrey maintained a Buy rating, while raising the price target from $28 to $33.

“BNPL is a viable tender type and Affirm is the mkt leader, owing to superior tech, ways to pay, a leading card present value prop and important enterprise customers,” Jeffrey wrote in a note.

“If we are correct, investors should expect BNPL tender to steadily rise from ~5% of eCommerce over the next several yrs, while edging into the 5x larger card present TAM,” the analyst said. “We think this outlook makes AFRM a core growth holding,” he added.

Piper Sandler On Affirm Holdings

Analyst Kevin Barker reiterated an Underweight rating, while lifting the price target from $11 to $12.

Affirm Holdings reported $5.6 billion in gross merchandise value (GMV) and $497 million in total revenues, with both figures beating expectations, Barker said.

“In addition, operating expenses dropped to $154M from $169M last Q as AFRM continued to experience efficiency improvements through technology advancements,” the analyst stated. He added that the company’s active consumers grew 15% year-on-year, transactions per customer increased to 4.1, and 75% of transactions were interest-bearing.

Check out other analyst stock ratings.

Wedbush On Affirm Holdings

Analyst David Chiaverini reaffirmed an Underperform rating, while raising the price target from $10 to $15.

Affirm reported “solid” results for the quarter and provided better-than-expected guidance, Chiaverini said in a note. Its operating margin of 12% “was well above our 3% forecast driven by increasing operating expense leverage,” he added.

“Guidance assumes the current forward curve and that negative consumer sentiment should persist through the remainder of the fiscal year,” the analyst further stated.

RBC Capital Markets On Affirm Holdings

Analyst Daniel Perlin maintained a Sector Perform rating, while lifting the price target from $17 to $26.

“AFRM continues to innovate and manage its overall portfolio, despite persistently higher rates, macro uncertainty, and investor concerns over a possible weakening consumer,” Perlin wrote in a note.

“Profitability this quarter, as measured by adj. operating income margin, came in at 12%, well ahead of guidance and estimates,” he added.

Mizuho Securities On Affirm Holdings

Analyst Dan Dolev reiterated a Buy rating and price target of $24.

“AFRM stock has been a rare success in FinTech in 2023, and F1Q is no different,” Dolev said. “Revenue less transaction costs (RLTC) at $212mn was also comfortably above the high-end of the guide ($190mn),” he added.

“Worried about higher for longer? CFO highlights stable 3-4% RLTC in FY24 helped by pricing,” the analyst further wrote.

AFRM Price Action: Shares of Affirm Holdings were up 18.18% to $25.72 at the time of publication Thursday.
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