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Installment payment broker To affirm (NASDAQ:AFRM) is sometimes known as a “buy now, pay later” (BNPL) niche market specialist. Owners of AFRM shares often rely on the growth of the emerging BNPL industry over time.

Source: Piotr Swat /

So far, their bets on Affirm have paid off. The stock price is skyrocketing, although this could set off the alarm bells for contrarian investors.

Is AFRM’s stock going too far, too fast? Not necessarily, as there is data showing that Affirm is growing its network of merchants and consumers, as well as its revenue.

And now there is a prominent major bank analyst with very positive comments on Affirm. This is just the icing on the cake as the bull thesis for Affirm continues to strengthen in 2021.

A closer look at AFRM’s stock

On February 11 of this year, AFRM stock hit a 52-week high (at the time) of $ 146.90. That’s pretty impressive, considering Affirm previously valued its shares at $ 49 apiece, which was already above the target range of $ 41- $ 44.

After the initial pop, however, came a steep drop. This seems to be a trend with many initial public offering (IPO) stocks lately.

It was a tough summer as AFRM shares fell to $ 50 and then hovered for a while. Traders who panicked during this time would likely regret their decision soon.

Call it a miracle if you will, but after the summer ended, buyers pushed the Affirm share price back to its all-time high in the fall.

AFRM stock hovers around $ 158. It is a story of return in the making.

So now, let’s dig a little deeper into a business that’s poised to change the way sellers sell and the way payers pay at checkout.

Grow and innovate

Being in the BNPL space is actually just a buzzword that Affirm offers point-of-sale loans.

This is great for customers, as Affirm allows many of them to fund online purchases and pay them off in monthly installments without the harsh impact of compound interest.

Affirm works with approximately 6,500 retailers and is used by over 6.2 million people (according to the company).

The company recently released a quarterly report showing 97% year-over-year growth in active consumers.

On top of that, year over year, Affirm produced 106% growth in gross cargo volume (GMV); a total increase in income of 71%; and a 412% expansion in the number of active merchants for the company.

Despite these astonishing statistics, Affirm is not just resting on its laurels. The company continues to innovate with its newly launched Adaptive Checkout product.

This platform uses an intelligent decision engine to “offer personalized payment options based on the size of the transaction as well as a real-time underwriting decision”.

A clear light point

There is already data demonstrating the benefits of Adaptive Checkout.

Compared to offering monthly payments through Affirm only, merchants using Adaptive Checkout in Early Access saw, on average:

  • A 26% increase in cart conversion
  • A 22% increase in approvals
  • A 20% improvement in sales

Perhaps it was Affirm’s transformative spirit that prompted Bank of America (BoA) analysts to identify Affirm as one of BNPL’s suppliers.

In a note released Oct. 12, BoA analysts raised their price target for the AFRM stock from $ 119 to $ 160.

Calling Affirm “the bright spot,” analysts observed that while “all other BNPL vendors experienced a deceleration in app downloads in September and [monthly active users] growth from August and 1H, AFRM was the only vendor to see growth accelerate in both metrics.

It’s hard to argue with the experts on Wall Street when they have data-driven ammunition like this.

With this, BoA analysts are gearing up for Afffirm to generate 30% revenue growth “for at least the next few years, thanks to the growth of the BNPL market and the launch of new products.”

The bottom line

There is no need to worry that the rally in AFRM stock is premature. Really, it’s a comeback story that should spark more investor interest in Affirm.

So opponents can relax and even consider going long in the stock. After all, BoA’s Affirmation makes Affirm more beautiful than ever.

At the date of publication, David Moadel did not hold (directly or indirectly) any position in the securities mentioned in this article. The opinions expressed in this article are those of the author, subject to Publication guidelines.

David Moadel provided compelling content – and sometimes crossed the line – on behalf of Crush the Street, Market Realist, TalkMarkets, Finom Group, Benzinga and (of course) He is also a chief analyst and market researcher for Portfolio Wealth Global and hosts the popular YouTube financial channel Looking at the Markets.


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