Affirm Holdings, Inc. (AFRM)
UndervaluedFundamental
84
Price
$67.94
Market Cap
$24.15B
Part 1 · What the company is worth
Overview
Affirm lets shoppers split a purchase into installment payments at checkout, an alternative to a credit card sold as "buy now, pay later." It partners with online and in-store merchants — including Amazon and Shopify sellers — who offer Affirm as a payment option, and with banks and card networks that help fund the loans. Affirm underwrites each purchase individually using its own risk models, rather than issuing an open-ended credit line the way a traditional card does.
How it makes money
Affirm earns fees from merchants for driving sales and offering the installment option, interest income on the loans it holds, and a growing card-network fee on purchases made with its debit-like card. It also sells some loans to investors rather than keeping them on its own books, booking a gain when the sale price exceeds the loan's carrying value, plus ongoing fees for continuing to service loans it no longer owns.
Revenue by segment
Interest charged on installment loans Affirm holds on its own balance sheet, its single largest revenue source.
Fees paid by merchants for offering Affirm's installment payments at checkout, based on the value of purchases financed.
Profit booked when loans are sold to outside investors, plus ongoing fees for servicing loans Affirm no longer owns.
Interchange fees earned when purchases are made using Affirm's debit-like card rather than through a merchant's checkout integration.
Competitive moat
Switching costs · NarrowLarge merchant partners such as Amazon and Shopify have integrated Affirm directly into their checkout flow, a technical and commercial relationship that took time to build and that a rival would need to replicate deal by deal. But consumers can and do compare buy-now-pay-later offers freely, and merchants can add a competing option alongside Affirm.
What drives demand
CyclicalVolume financed through Affirm tracks discretionary consumer spending on the goods its merchant partners sell, which slows in a weaker economy just as loan defaults tend to rise — a double exposure to the credit cycle. Affirm's own funding costs also move with interest rates, squeezing margins when rates rise.
Key risks
- Concentration with large commerce partners — A significant share of loan volume flows through a small number of large commerce partners, including Amazon and Shopify; losing or renegotiating any one of these relationships on worse terms would materially affect volume.
- Credit risk and loan losses — Affirm bears the risk that consumers do not repay their installment loans, and losses rise in a weaker economy exactly when new loan volume tends to slow.
- Dependence on outside funding — Affirm depends on banks, warehouse facilities and loan investors to fund and buy the loans it originates; a disruption in credit markets could limit its ability to keep lending.
- Interest rate sensitivity — Higher interest rates raise Affirm's own cost of funding loans and can be passed only partly to consumers, compressing the spread the company earns on interest-bearing loans.
The case for
Buyers argue that Affirm's point-of-sale underwriting model captures a growing share of consumer spending as buy-now-pay-later becomes mainstream, and that deep integrations with large partners like Amazon and Shopify give it distribution rivals would need years to match.
The case against
Sellers worry that Affirm's business concentrates a meaningful share of volume with a handful of large commerce partners it does not control, that loan losses rise in exactly the economic conditions that also slow new volume, and that dependence on outside funding leaves it exposed to swings in credit markets and interest rates.
Written by the editors, published on August 18, 2026
Direct competitors
Who this company fights with for the same customers
Generated on August 23, 2026 with claude-opus-5 — shared with all users
Through Afterpay, integrated into Cash App, Block offers the same pay-in-four installment checkout to the same young US consumers and the same retail merchants Affirm signs up.
PayPal's Pay in 4 and PayPal Credit put an installment option in front of the same online buyers at the same moment of checkout, backed by a wallet already installed at most US merchants.
The first name on Affirm's own competition list: Synchrony finances the same point-of-sale purchases through store-branded cards and promotional installment plans, especially in home goods, healthcare and electronics.
A pure-play US buy-now-pay-later provider chasing the same thin-credit-file shoppers and the same mid-market merchant integrations Affirm targets.
Named by Affirm in its 10-K as a pay-over-time rival, Klarna competes for the same US and European online shoppers and the same merchant checkout placement, from fashion and travel to big-ticket retail.
Cited by Affirm among the card-issuing banks it competes with, Bread Financial sells retailers the same package of private-label credit and split-pay checkout financing.
Balance Sheet & Liquidity
Revenue
$1.44B
Trailing 12 months (through 6/30/2026)
Net Income
$1.93B
Trailing 12 months (through 6/30/2026)
Free Cash Flow
$993M
Total Equity
$5.48B
Total Liabilities
$10.31B
Current Ratio
4.16
Interest Coverage
0.92
Debt/EBITDA
13.64
Earnings Per Share
Revenue & Net Income
Free Cash Flow
Income Breakdown
Historical statement
Margins over time
Debt over time
How heavy the debt is
Growth grid
Growth — Revenue
Fair Value Estimation
Fair Value
$126.68
Current Price
$67.94
Margin of Safety
+46.4%
Fair Value Range
$94.75 - $158.61
Spread across the valuation methods used, not a statistically calibrated confidence interval.
Estimation Methods
Valuation Metrics
P/E Ratio
12.52
ROE
35.2%
P/B Ratio
0.75
P/FCF
4.13
Gross Margin
-
ROIC
-
Profitability Radar
Value Creation (Economic Moat)
ROIC
-
WACC
13.9%
ROIC − WACC
-
Fundamental Analysis Criteria
Passed (18)
- EPS shows upward trend
- P/FCF 4.13
- P/B Ratio 0.75
- Debt/Equity ratio
- Operating Margin 28.9%
- Positive Free Cash Flow
- CapEx intensity
- Return on Tangible Assets
- Low reliance on intangibles
- Price below Graham Number
- DCF valuation (Undervalued)
- ROE 47.9%
- Revenue Growth 5Y 37.4%
- Analyst Consensus 76% Buy
- Earnings Surprise avg 355.4%
- Share Dilution 0.3%
- Net Margin Trend 133.6% vs 4.7%
- Piotroski F-Score 5/9
Failed (4)
- Price CAGR -7.50%
- Interest Coverage
- Debt/EBITDA
- Earnings Quality (OCF/NI) 0.64
Unavailable (5)
- ROIC NaN%
- Gross Margin NaN%
- Dividend Payout NaN%
- Current Ratio
- PEG Ratio (need PE > 0 and growth > 0)
Piotroski F-Score
Mixed signals: some areas need attention
Earnings Quality
Moderate: some gap between profits and cash
Share Dilution
Share count is stable
Institutional Holdings
Governance
Executive Team
| Name | Title | Age |
|---|---|---|
| Mr. Max Roth Levchin | Founder, CEO & Chairman | 49 |
| Mr. Michael A. Linford | President | 42 |
| Mr. Libor Michalek | President & Director | 51 |
| Mr. Robert W. O'Hare | Chief Financial Officer | 44 |
| Ms. Katherine Adkins Esq. | Chief Legal & Compliance Officer and Secretary | 63 |
| Ms. Siphelele Jiyane | Chief Accounting Officer | - |
| Mr. Zane Keller C.F.A. | Head of Investor Relations | - |
| Ms. Brooke E. Major-Reid | Chief Capital Officer | 50 |
| Dr. Wayne Pommen Ph.D. | Chief Revenue Officer | 46 |
| Pat Suh | Senior Vice President of Revenue | - |
Audit Risk
1
Board Risk
8
Compensation Risk
8
Shareholder Rights Risk
10
Part 2 · The price and when to enter
This part won't tell you whether the company is worth owning: it helps you choose when to buy it, once the fundamentals have convinced you. Inside: technical analysis, potential, historical drawdowns, gamma exposure.
Documents
- View document
Annual Report (10-K)
A yearly overview of the business, its financial results, and the risks it faces.
Filed on 2026-08-27
- View document
Quarterly Report (10-Q)
A snapshot of financial performance for the most recent three-month period.
Filed on 2026-05-07
- View document
Current Report (8-K)
An announcement of a major event, such as a leadership change or big news.
Filed on 2026-08-27
via SEC EDGAR
Income History
via SEC EDGAR
Latest News
Recent headlines for AFRM, sourced from Markets Gazette.
- 8/28/2026POSITIVELe azioni Affirm volano dopo profitti record: perché BofA vede un rialzo vicino al 35%
Affirm Holdings Inc. saw its stock surge approximately 11% following a strong fourth-quarter earnings report, marking the company's most profitable quarter to date. The 'buy-now, pay-later' firm posted an adjusted earnings per share of $4.62, significantly beating analyst expectations of $3.77. Revenue reached $1.2 billion, surpassing the consensus estimate of $1.1 billion and demonstrating a 33% year-over-year increase. Gross Merchandise Volume (GMV) also showed robust growth, climbing 36% to $14.1 billion. This marks the 11th consecutive quarter of GMV growth at or above Affirm's targets, signaling sustained operational strength and market traction.
- 8/27/2026NEUTRALIl titolo Affirm si sta comprimendo: perché potrebbe esplodere dopo gli utili
Affirm Holdings Inc. (AFRM) stock has been trading sideways around $76.45, consolidating within a symmetrical triangle pattern. This technical setup suggests a potential breakout following the company's upcoming earnings release. The stock has shown resilience, recovering from its yearly low of $42 to its current trading range. Investors are awaiting the financial results to gauge the company's performance and future outlook, which could trigger a significant price movement. The symmetrical triangle indicates potential for a substantial move once the pattern resolves.
- 5/13/2026POSITIVEAffirm Unveils Aggressive Expansion Blueprint
Bank of America has reiterated its 'Buy' rating on Affirm Holdings Inc. (AFRM), setting a price target of $88. This optimistic outlook is underpinned by the company's aggressive expansion strategy, highlighted by new product launches and a significant partnership with Shopify. Analysts are particularly bullish on Affirm's potential to capture market share through these initiatives. The firm's ability to innovate and forge strategic alliances is seen as a key driver for future growth, suggesting a positive trajectory for the stock.
- 5/12/2026POSITIVEWhat's Going On With Affirm Stock Today?
Affirm Holdings has announced a strategic partnership with Google, integrating its 'buy now, pay later' (BNPL) solutions directly into Google Search and the Gemini app. This collaboration signifies a major expansion for Affirm into AI-driven shopping experiences, potentially broadening its customer reach and transaction volume significantly. The integration aims to streamline the online purchasing journey for consumers, offering flexible payment options at the point of sale within Google's ecosystem. For investors, this move could represent a substantial growth catalyst, enhancing Affirm's market position and competitive advantage in the rapidly evolving fintech landscape.
- 5/7/2026NEGATIVEAffirm Stock Trades Lower On Q3 Results, Raised Guidance
Affirm Holdings Inc. saw its stock price decline despite raising its full-year guidance. The company reported Q3 results that may have disappointed investors, leading to a sell-off. While the raised outlook suggests management's confidence in future performance, the market's reaction indicates a disconnect between the company's forward-looking statements and current investor sentiment. This could be due to factors such as increased competition, regulatory scrutiny, or concerns about the company's path to profitability. Investors will be closely watching the next earnings call for further clarity on the company's strategic initiatives and financial health.
- 3/18/2026NEGATIVEAffirm Stock Falls Wednesday As Fed Signals Higher Inflation Outlook
Affirm Holdings Inc. shares experienced a decline on Wednesday, influenced by the Federal Reserve's indication of sustained interest rates and a cautious outlook on inflation. The Fed's decision to maintain its current rate policy, coupled with concerns that inflationary pressures might persist longer than anticipated, has led investors to re-evaluate risk exposure. This sentiment is particularly impactful for growth-oriented companies like Affirm, which often rely on favorable borrowing costs and a robust consumer spending environment. The market's reaction suggests a heightened sensitivity to macroeconomic signals that could affect the buy-now-pay-later sector's growth trajectory.
- 3/9/2026POSITIVEThe Best Fintech Stocks to Buy With $500 Right Now
Affirm Holdings Inc. is highlighted as a top fintech stock with significant growth potential, alongside Chime Financial. Affirm, a leading 'buy now, pay later' (BNPL) provider, has demonstrated resilience and innovation in a competitive market. Its stock, trading on the Nasdaq, is seen as an attractive entry point for investors looking to capitalize on the evolving digital payments landscape. The company's focus on user experience and merchant partnerships positions it for continued expansion, making it a compelling choice for those seeking high-growth fintech exposure.
via Markets Gazette