Affirm (AFRM) Shares Explode Over 30% on Raised Guidance, Analyst Remains Bullish

May 13, 2022 6:08 AM EDT
Get Alerts AFRM Hot Sheet
Price: $24.82 -3.46%

Rating Summary:
    12 Buy, 6 Hold, 2 Sell

Rating Trend: Down Down

Today's Overall Ratings:
    Up: 4 | Down: 15 | New: 18
Trade Now! 
Join SI Premium – FREE

Get instant alerts when news breaks on your stocks. Claim your 1-week free trial to StreetInsider Premium here.

Shares of Affirm Holdings (NASDAQ: AFRM) are up more than 30% in premarket trading Friday after the company hiked its FY revenue forecast.

The fintech company reported a Q3 loss per share of 19c, compared to a loss per share of $1.06 in the same period last year. Revenue came in at $354.8 million in the quarter, up 54% YoY and above the consensus estimates of $344.3 million. The company reported a gross merchandise volume of $3.9 billion, while analysts were projecting $3.86 billion.

For the fourth quarter, AFRM expects revenue in the range of $345 million to $355 million, compared to the analyst consensus of $353.1 million. The company anticipates a gross merchandise volume in the range of $3.95 billion to $4.05 billion, compared to the analyst estimates of $3.95 billion.

Looking ahead to the full fiscal year performance, Affirm expects FY revenue in the range of $1.33 billion to $1.34 billion, up from the previous forecast of $1.31 billion, while analysts were expecting $1.33 billion.

Gross merchandise value for the full year is expected in the range of $15.04 billion to $15.14 billion, up from the previous guidance of $14.78 billion, and compared to the expected $15 billion.

Affirm said it agreed to a multi-year extension of its deals with Shopify in the U.S, making the fintech company the exclusive pay-over-time provider for Shop Pay Installments.

“We plan to achieve a sustained profitability run rate on an adjusted operating income basis by July 1, 2023,” the company said.

BofA analyst Jason Kupferberg reiterated a Buy rating and a $77.00 per share price target on AFRM stock.

“After a major pullback in shares, AFRM’s F3Q print was a sight for sore eyes along multiple dimensions and should be well-received… We continue to see credit (where performance beat internal plan in F3Q) as manageable, while AFRM remains differentiated in the Buy Now Pay Later (BNPL) market,” the analyst said in a client note.

Truist Securities analyst Andrew W. Jeffrey also reiterated a Buy rating and said Affirm is doing a better job than competitors on BNPL. As such, the company is well-positioned to capture a significant share of the US consumer debit market.

By Senad Karaahmetovic

Serious News for Serious Traders! Try Premium Free!

You May Also Be Interested In

Related Categories

Analyst Comments, Earnings, Guidance, Hot Earnings, Hot Guidance, Hot List

Related Entities

Senad Karaahmetovic