Affirm (NASDAQ:AFRM) Releases Quarterly Earnings Results, Beats Estimates By $0.09 EPS

Affirm (NASDAQ:AFRM) announced its earnings results on Thursday. The company reported $0.37 earnings per share for the quarter, beating analysts’ consensus estimates of $0.28 by $0.09, FiscalAI reports. Affirm had a net margin of 6.74% and a return on equity of 7.75%. The business had revenue of $1.12 billion for the quarter, compared to the consensus estimate of $1.06 billion.

Affirm Trading Down 4.4%

AFRM traded down $2.74 on Thursday, hitting $59.42. 12,923,846 shares of the company were exchanged, compared to its average volume of 6,063,928. The company has a debt-to-equity ratio of 2.40, a quick ratio of 12.80 and a current ratio of 12.80. The firm has a fifty day simple moving average of $72.00 and a two-hundred day simple moving average of $74.34. The stock has a market capitalization of $19.61 billion, a PE ratio of 88.69, a price-to-earnings-growth ratio of 2.73 and a beta of 3.56. Affirm has a 12 month low of $30.90 and a 12 month high of $100.00.

Key Affirm News

Here are the key news stories impacting Affirm this week:

• Positive Sentiment: Q2 results beat expectations — EPS $0.37 vs. $0.28 est. and revenue $1.12B vs. $1.06B est., showing stronger-than-expected top- and bottom-line performance. Press Release
• Positive Sentiment: Revenue growth was driven by higher gross merchandise volume (GMV), a healthy demand signal for Affirm’s core BNPL and merchant services business. Affirm Sales Jump
• Positive Sentiment: Analyst support picked up: Morgan Stanley upgraded Affirm to Overweight, which could support sentiment over a longer horizon. Upgrade Note
• Neutral Sentiment: The company updated guidance: Q3 revenue $970M–$1.0B (vs. $973.6M consensus) and FY revenue ~ $4.1B (in line with consensus). Q4 revenue guidance was ~$1.1B (above prior consensus), so guidance is mixed across periods. (Company guidance releases)
• Neutral Sentiment: Affirm filed the shareholder letter and Form 8?K with details on results and will host a conference call — useful to parse management commentary for margin and loan performance color. Company Release
• Negative Sentiment: Market reaction appears negative because Affirm did not provide explicit forward EPS guidance (EPS guidance fields were blank in updates), leaving investors uncertain about near-term profitability despite the beat.
• Negative Sentiment: Valuation and technicals may be headwinds: the stock trades below its 50- and 200-day moving averages and carries a high NTM P/E, so even good quarterly prints can be met with profit-taking.

Wall Street Analysts Forecast Growth

Several analysts have recently weighed in on the stock. Needham & Company LLC upgraded shares of Affirm from a “hold” rating to a “buy” rating and set a $100.00 price objective on the stock in a research report on Tuesday, January 27th. Weiss Ratings restated a “hold (c-)” rating on shares of Affirm in a research report on Monday, December 29th. Cantor Fitzgerald raised Affirm to a “strong-buy” rating in a research note on Tuesday, January 27th. Wolfe Research began coverage on Affirm in a research report on Tuesday, December 9th. They set a “peer perform” rating on the stock. Finally, BTIG Research reissued a “neutral” rating on shares of Affirm in a report on Wednesday, December 17th. Three analysts have rated the stock with a Strong Buy rating, nineteen have assigned a Buy rating and eight have assigned a Hold rating to the company’s stock. According to data from MarketBeat.com, Affirm currently has a consensus rating of “Moderate Buy” and an average price target of $89.16.

Insider Buying and Selling

In other Affirm news, CEO Max R. Levchin sold 666,666 shares of the firm’s stock in a transaction on Monday, January 5th. The shares were sold at an average price of $80.62, for a total value of $53,746,612.92. The sale was disclosed in a document filed with the SEC, which is available at the SEC website. Also, CFO Robert O’hare sold 36,401 shares of the business’s stock in a transaction dated Monday, January 5th. The shares were sold at an average price of $80.00, for a total transaction of $2,912,080.00. Following the completion of the transaction, the chief financial officer owned 1,368 shares in the company, valued at $109,440. The trade was a 96.38% decrease in their position. The SEC filing for this sale provides additional information. In the last three months, insiders have sold 711,256 shares of company stock valued at $57,231,923. Insiders own 11.01% of the company’s stock.

Institutional Trading of Affirm

Several large investors have recently modified their holdings of AFRM. Triumph Capital Management purchased a new position in Affirm during the 3rd quarter valued at about $31,000. Larson Financial Group LLC grew its position in shares of Affirm by 74.5% in the 3rd quarter. Larson Financial Group LLC now owns 499 shares of the company’s stock worth $36,000 after buying an additional 213 shares during the last quarter. Livforsakringsbolaget Skandia Omsesidigt bought a new stake in shares of Affirm in the 3rd quarter worth approximately $131,000. Harvest Fund Management Co. Ltd purchased a new position in shares of Affirm during the third quarter valued at approximately $146,000. Finally, Advisory Services Network LLC bought a new position in shares of Affirm during the third quarter valued at approximately $194,000. 69.29% of the stock is owned by institutional investors.

Affirm Company Profile

Affirm Holdings, Inc is a financial technology company that provides point-of-sale consumer lending and payments solutions for online and in-store purchases. Its core product is a buy-now-pay-later (BNPL) platform that enables consumers to split purchases into fixed, transparent installment loans with no hidden fees. Affirm offers a range of financing options through merchant integrations, a consumer-facing mobile app and virtual card capabilities, and tools for merchants to offer alternative payment methods at checkout.