Affirm (AFRM) Launches Solution to Ease Checkout for Customers
Zacks Investment Research | Sep 23, 2021 01:29AM ET
Affirm Holdings, Inc. SHOP , Amazon.com (NASDAQ:AMZN), Peloton (NASDAQ:PTON) and others who use its instalment plan service to offer their customers.
In May, Affirm completed the acquisition of Returnly, a leader in the online return experience and post-purchase payment space. On the merchant side, this acquisition meaningfully expanded the company’s addressable market. Affirm also extended its presence in North America by closing the buyout of the leading pay later brand PayBright in Canada, earlier in January..
This fintech company is in its early stages and is incurring losses, which may continue for some more years as it expands to get a considerable market share. Investors will be looking for its top-line growth.
Per its latest quarterly updates, active merchants surged 412% to nearly 29,000 while active consumers grew 97% to 7.1 million year over year. Transactions per active consumer increased 8% to 2.3 as of Jun 30, 2021. Another key metric, gross merchandise value (GMV), soared 79% to $8.3 billion. Growth in these metrics reflects its strong business and stickiness of its products.
Affirm also provided a strong guidance for 2022, which expects GMV in the range of $12.45-$12.75 billion, revenues between $1.16 billion and $1.19 billion and an adjusted operating loss between $145 million and $135 million. The revenue view indicates growth of 33-36% from the year-ago reported figure. GMV outlook suggests an increase between 50% and 54%.
The company currently carries a Zacks Rank #3 (Hold). It should give good returns over the long term as it increases its market share and turns profitable. Since its IPO in January, the stock has gained 17.3%.
You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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