S&P 500   4,538.43
DOW   34,580.08
QQQ   383.13
S&P 500   4,538.43
DOW   34,580.08
QQQ   383.13
S&P 500   4,538.43
DOW   34,580.08
QQQ   383.13
S&P 500   4,538.43
DOW   34,580.08
QQQ   383.13

Affirm Stock is Ready to Rally

Wednesday, June 30, 2021 | Jea Yu
Affirm Stock is Ready to Rally E-commerce network and solutions platform provider Affirm (NASDAQ: AFRM) stock is rallying off its post-IPO lows as ecommerce continues to flourish in a post-pandemic era as reopenings continue to get underway. The Company provides of payment financing options for purchases from popular brands like the Moon Pod, Peloton (NASDAQ: PTON) , Dyson, Casper (NASDAQ: CSPR) along with offerings from over 6,500 merchants on its platform. Merchants are enamored with the boost in sales when Affirm enables customers to make monthly installment payments, also known as buy-now-pay-later (BNPL) programs, through them. Ecommerce coupled with BNPL comprise strong secular tailwinds that should expand growth. Consumers are enamored by the frictionless and streamlined manner of making large purchases in smaller bite-size payments. The Company makes fees from both the customer and merchant all while facilitating the sale. Payment plans can range from three months up to 48 months with many interest-free options. The pandemic has accelerated e-commerce adoption by a decade and its showing to be a lot stickier than analysts assumed as it becomes a pivotal cornerstone of the new normal. It’s a partnership with Shopify (NASDAQ: SHOP) enables over 10,000 merchants on its platform to provide ShopPay BNPL plans powered by Affirm’s technology. Prudent investors seeking to gain exposure in e-commerce regardless of the brand with a major BNPL facilitator can look to build a position in Affirm shares at opportunistic pullback levels.

Q3 Fiscal 2021 Earnings Release

On May 18, 2021, Affirm reported its fiscal Q3 2021 results for the quarter ending Mar 2021. The Company reported an earnings-per-share (EPS) loss of (-$1.06) versus (-$0.26) consensus analyst estimates, an (-$0.80) miss. Revenues grew 66.8% year-over-year (YoY) to $230.67 million, beating analyst estimates for $197.94 million. Active merchants doubled to nearly 12,000 by March 31, 2021 from year-ago. Average transactions per active customer were 2.3, up 10% YoY. The Company completed its acquisition of Returnly, a leader in online return experiences and post-purchase payments serving over 1,800 merchants and eight million shoppers.

CEO Statement

Affirm Founder and CEO Max Levchin stated, “Affirm’s strong third-quarter results reflect continued progress toward building the most valuable and trans parent financial network for consumers and merchants. During the period, we more than doubled the number of merchants on our platform, accelerated GMV (gross merchandise value) growth to 83%, and increase active consumers 60% year-over-year” He continued, “We are seeing strong momentum in our business as we advance our growth strategy. In recent weeks, we have activated ShopPay Installments powered by Affirm for more than 10,000 Shopify merchants. We expect this number to significantly increase as we move towards general availability in June.”

Raised Q4 Fiscal 2021 Guidance

Affirm raised its fiscal Q4 2021 revenues to come in between $215 million to $225 million versus $208.17 million consensus analyst estimates. The Company expects to see GMV growth accelerate in categories with “pent-up demand”, including travel and ticketing, which grew 50% YoY in Q3. The merchant network growth will lead to more adoption of BNPL which adds directly to the top and bottom line. The bar has been set rather low heading into the reopening as the new consumer preference is to shop and compare online before making the trip to the brick and mortar stores. The convenience and making expensive purchases in bite-size pieces makes BNPL one of the strongest tailwinds that consumers will drive for the foreseeable future.

Affirm Stock is Ready to Rally

AFRM Opportunistic Pullback Levels

Using the rifle charts on the weekly and daily time frames provides a precision view of the landscape for AFRM stock. AFRM stock peaked near the $147.46 Fibonacci (fib) level after its IPO and managed to collapse as low as $46.50 during the pandemic before staging a rally. The weekly rifle chart has rallied to a make or break set-up as the weekly 5-period MA support is rising at $64.20 to attempt a crossover through the 15-period MA at $65.73. The weekly stochastic has a mini pup nearing the 40-band. The daily rifle chart is also in a make or break inversely with the falling 5-period MA at $64.63 crossing down through the 15-period MA at $65.21 as the daily stochastic is in a mini inverse pup. The daily market structure low (MSL) buy triggered on the breakout above $54.61. The daily lower Bollinger Band (BBs) sit near the $56.79 fib with upper BBs at $72.22. Prudent investors can monitor for opportunistic pullback levels at the $62.37 fib, $59.52 daily MSH trigger, $56.79 fib, $54.61 daily MSL trigger, $52.98 fib, $47.62 fib, and $43.58 fib. Upside trajectories range from the $78.09 fib up to the $104.41 fib level.

 

Should you invest $1,000 in Affirm right now?

Before you consider Affirm, you'll want to hear this.

MarketBeat keeps track of Wall Street's top-rated and best performing research analysts and the stocks they recommend to their clients on a daily basis. MarketBeat has identified the five stocks that top analysts are quietly whispering to their clients to buy now before the broader market catches on... and Affirm wasn't on the list.

While Affirm currently has a "Buy" rating among analysts, top-rated analysts believe these five stocks are better buys.

View The 5 Stocks Here

 


Companies Mentioned in This Article

CompanyMarketRank™Current PricePrice ChangeDividend YieldP/E RatioConsensus RatingConsensus Price Target
Affirm (AFRM)2.2$107.24-5.7%N/A-34.37Buy$148.63
Peloton Interactive (PTON)2.8$43.55-2.0%N/A-20.26Hold$103.09
Compare These Stocks  Add These Stocks to My Watchlist 

Resources

Premium Research Tools

MarketBeat All Access subscribers can access stock screeners, the Idea Engine, data export tools, research reports, and other premium tools.

Discover All Access

Market Data and Calendars

Looking for new stock ideas? Want to see which stocks are moving? View our full suite of financial calendars and market data tables, all for free.

View Market Data

Investing Education and Resources

Receive a free world-class investing education from MarketBeat. Learn about financial terms, types of investments, trading strategies and more.

Financial Terms
Details Here
MarketBeat - Stock Market News and Research Tools logo

MarketBeat empowers individual investors to make better trading decisions by providing real-time financial data and objective market analysis. Whether you’re looking for analyst ratings, corporate buybacks, dividends, earnings, economic reports, financials, insider trades, IPOs, SEC filings or stock splits, MarketBeat has the objective information you need to analyze any stock. Learn more about MarketBeat.

MarketBeat is accredited by the Better Business Bureau

© American Consumer News, LLC dba MarketBeat® 2010-2021. All rights reserved.
326 E 8th St #105, Sioux Falls, SD 57103 | U.S. Based Support Team at [email protected] | (844) 978-6257
MarketBeat does not provide personalized financial advice and does not issue recommendations or offers to buy stock or sell any security.

Our Accessibility Statement | Terms of Service | Do Not Sell My Information

© 2021 Market data provided is at least 10-minutes delayed and hosted by Barchart Solutions. Information is provided 'as-is' and solely for informational purposes, not for trading purposes or advice, and is delayed. To see all exchange delays and terms of use please see disclaimer. Fundamental company data provided by Zacks Investment Research.