BNPL Company Affirm Holdings Exhibits Strong Growth And Fair Valuation Amid Regulatory Risks, Says Analyst
Portfolio Pulse from Anusuya Lahiri
JMP Securities analyst David Scharf initiated coverage on Affirm Holdings Inc (NASDAQ:AFRM) with a Market Perform rating, citing strong growth and fair valuation amid regulatory risks. Affirm's business model has diversified, but it faces the same risks as other non-prime lenders. Shares are trading at a higher valuation compared to American Express (NYSE:AXP) and Discover Financial Services (NYSE:DFS).
June 28, 2024 | 4:59 pm
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NEUTRAL IMPACT
JMP Securities analyst David Scharf initiated coverage on Affirm Holdings with a Market Perform rating. Despite strong growth and a diversified business model, Affirm faces significant regulatory and macroeconomic risks. Shares are trading at a higher valuation compared to peers.
The Market Perform rating suggests a neutral outlook. While Affirm shows strong growth and a diversified business model, the higher valuation and regulatory risks balance out the positive aspects. This results in a neutral short-term impact on the stock price.
CONFIDENCE 90
IMPORTANCE 80
RELEVANCE 100
NEUTRAL IMPACT
Affirm Holdings is trading at a higher valuation compared to American Express, which is trading at 15x fiscal 2026 adjusted EPS estimate. This comparison highlights Affirm's higher growth expectations but also its higher risks.
The comparison to Affirm's valuation does not directly impact American Express's stock price in the short term. However, it highlights the differences in growth expectations and risk profiles between the two companies.
CONFIDENCE 80
IMPORTANCE 50
RELEVANCE 50
NEUTRAL IMPACT
Affirm Holdings is trading at a higher valuation compared to Discover Financial Services, which is trading at 10x fiscal 2026 adjusted EPS estimate. This comparison underscores Affirm's higher growth potential but also its higher risks.
The comparison to Affirm's valuation does not directly impact Discover Financial Services' stock price in the short term. However, it highlights the differences in growth potential and risk profiles between the two companies.
CONFIDENCE 80
IMPORTANCE 50
RELEVANCE 50