William Blair analyst Andrew Jeffrey has maintained their bullish stance on AFRM stock, giving a Buy rating on March 11.
Andrew Jeffrey has given his Buy rating due to a combination of factors that suggest Affirm Holdings remains a strong investment despite recent news. The report highlights that the market’s reaction to Klarna becoming Walmart’s exclusive BNPL provider may be overstated, as Affirm’s exposure to Walmart is not significant enough to impact its revenue estimates substantially. The analyst believes that Affirm’s risk/reward profile is attractive, especially considering its valuation relative to future EBITDA estimates.
Furthermore, Jeffrey points out that the contract Klarna secured with Walmart is not aligned with Affirm’s business model, which prioritizes superior customer experience and technology integration. He suggests that the loss of Walmart as a partner might be a one-off event, likely influenced by pricing strategies that Affirm would not entertain. Affirm’s value proposition to merchants, which includes enhancing customer loyalty and conversion rates, remains strong, indicating that the company’s fundamentals are intact and supportive of a Buy rating.
In another report released on March 11, TD Cowen also maintained a Buy rating on the stock with a $51.00 price target.