AFRM Should I Buy
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Affirm Holdings Inc (AFRM) is not a strong buy at this moment for a beginner investor with a long-term strategy. While the company shows growth in revenue and has positive developments like its partnership with Stripe, the financial performance reveals significant declines in net income and EPS. Insider selling activity and bearish moving averages further indicate caution. Analysts are mixed, with some maintaining buy ratings but lowering price targets due to macroeconomic risks and competition. For a long-term investor, it may be better to wait for a more favorable entry point or stronger signals of sustained growth.
The MACD is positive and expanding, indicating bullish momentum. However, the RSI is neutral, and the moving averages are bearish (SMA_200 > SMA_20 > SMA_5), suggesting a lack of strong upward momentum. The stock is trading near its resistance level (R1: 52.012), which could act as a barrier for further price increases.
Affirm deepened its partnership with Stripe to enhance AI-assisted shopping, which could drive future growth.
The company raised its fiscal 2026 revenue outlook, signaling confidence in its business model.
Analysts highlight strong merchant relationships and advanced underwriting as competitive advantages.
Insiders are selling heavily, with a 9784.32% increase in selling activity over the last month.
Financial performance shows a significant drop in net income (-180.52% YoY) and EPS (-174.19% YoY).
Analysts have lowered price targets due to macro risks, competition in the BNPL space, and concerns over credit products.
In Q1 2026, revenue increased by 33.62% YoY to $933.34M, but net income dropped by -180.52% YoY to $80.69M. EPS also fell by -174.19% YoY to $0.23. Gross margin slightly improved to 92.33%, up 0.11% YoY.
Analysts are mixed on AFRM. While several maintain buy ratings, price targets have been lowered due to macroeconomic risks and competition from peers like Klarna and PayPal. Recent ratings include a Buy from BofA with an $82 target and a Neutral from Baird with a $55 target.
