Affirm Holdings Inc (NASDAQ:AFRM) shares climbed Thursday after the company reported strong fourth-quarter results.
The company reported its results amid an exciting earnings season. Here are some key analyst takeaways.
JPMorgan on Affirm Holdings
Analyst Reginald Smith reiterated an Overweight rating, while raising the price target from $46 to $47.
Affirm's GMV (gross merchandise value) grew by 31% year-on-year, beating Street expectations of 30%, Smith said in a note. Although this marked a five percentage point decline sequentially, it was consistent with other e-commerce and payment companies, he added.
The company reported a GAAP net loss of $45 million, "primarily burdened by nearly $180M of stock comp and warrant costs," the analyst wrote. Management expects GAAP profitability by the fiscal fourth quarter, which seems achievable "on continued operating leverage and lessening warrant expense burden beginning in C1Q25," he further stated.
Check out other analyst stock ratings.
Goldman Sachs on Affirm Holdings
Analyst Will Nance maintained a Buy rating while lifting the price target from $42 to $46.
The company reported "solid" results, with RLTC (revenue less transaction costs) exceeding expectations by 22%, Nance said. Adjusted operating income came in at around $150 million, ahead of Street estimates of $98 million, he added.
While management's guidance came in much better than expected, they made it clear that "the company's guidance philosophy around setting a floor on expected results has not changed, which we believe signals considerable room for outperformance," the analyst stated.
"Looking ahead, we remain highly constructive, as the company looks likely to continue to grow GMV in the 30% range in the near term, while only modestly growing opex and driving incremental RLTC/gross profit to the bottom line," he further wrote.
RBC Capital Markets on Affirm Holdings
Analyst Daniel Perlin maintained a Market Perform rating while raising the price target from $43 to $46.
Affirm reported total revenues of $659 million, beating consensus of $604 million, with GMV growing 31% year-on-year to $7.2 billion, Perlin said. The company's full-year guidance calls for GMV exceeding $33.5 billion, he added.
The company expects to achieve GAAP operating income profitability in the fiscal fourth quarter, "with plans to maintain profitability on an ongoing basis," the analyst stated. There is "potential for incremental benefit to FY25, depending on the timing of its Apple Pay commercialization and ramping of its international and B2B initiatives," he further wrote.
AFRM Price Action: Shares of Affirm Holdings had risen by 34.17% to $42.37 at the time of publication on Thursday.
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