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AFRM: Affirm Stock Price Forecast After the Comeback

AFRM: Affirm Stock Price Forecast After the Comeback

Last updated 13th May 2022
Disclosure
  • The Affirm stock price has surged after the strong results.
  • It has rallied by 77% from the YTD low.

The Affirm stock price is surging on Friday after the company published spectacular quarterly results. The shares rose by more than 23% on Thursday and are now 30% in the premarket session. They have risen by 77% from its lowest level this year, bringing the company’s market cap to over $5 billion.

Affirm strong earnings

Affirm is a fintech company that enables people to buy products and pay in installments over time. It is different from credit card companies simply because its loans don’t come with interest. Instead, the company makes money by taking a commission from sellers.

Therefore, there is strong demand for these services as interest rates rise in the US and its other key markets. In the first quarter, the number of active customers in the platform rose by 137%, or 210,000 while the number of total transactions rose by 80%.

In total, the company now has 12.7 million customers while the number of active merchants rose to 210,000. Its Gross Merchandise Value (GMV) soared to $3.9 billion. This growth happened as people started traveling again. Indeed, travel and ticketing revenue rose to $390 million.

Affirm’s revenue rose to $355 million, which was better than what most analysts were expecting. It now expects that its full-year GMV will rise to $15 billion.

Affirm is also in the crypto industry. In a statement, the company’s CEO said:

“We also added Bitcoin interest to the popular Affirm savings account, a super simple way for our savings account holders to hold cryptocurrency by choosing to receive their savings yield in Bitcoin.”

While Affirm is seeing strong growth, it is also having intense competition from the likes of Block and PayPal. Block acquired Australia’s AfterPay and is seeking to gain market share in the US. Similarly, PayPal’s BNPL business is also seeing robust growth.

Affirm stock price forecast

The Affirm stock price has gone parabolic in the past few days. And now, it is approaching the key resistance level at $26, which was the lowest level on March 4th. The coin has also moved slightly above the 25-day moving average while the two lines of the MACD have formed a bullish crossover.

Therefore, there is a likelihood that the AFRM stock price will keep rising as investors buy the dip. The next key resistance level to watch will be at $30.

Crispus Nyaga

Crispus Nyaga

Crispus is a financial analyst with over 9 years in the industry. He covers cryptocurrencies, forex, equities, and commodities for some of the leading brands. He is also a passionate trader who operates his family account. Crispus lives in Nairobi with his wife and son.