Affirm Holdings has retreated significantly following a strong quarterly earnings report, creating an attractive entry point for investors, according to Wolfe Research. The research firm upgraded the buy now, pay later company to outperform from peer perform, setting a price target of $90 that implies roughly 26% upside from Friday’s close.
“With AFRM shares having underperformed since the strong F4Q print, we view valuation as more compelling and continue to view AFRM as a structural winner with key growth drivers and proven execution,” said analyst Darrin Peller in a note to clients on Monday.
Shares of Affirm have declined approximately 8% since Aug. 27, when the company reported its fiscal fourth quarter results. Over that period, the stock has also trailed competitors such as Klarna as well as the S&P 500, both of which are down about 1% in the same window.
However, Wolfe Research believes the buy now, pay later provider is well-positioned for a rebound thanks to strong underlying fundamentals and favorable structural tailwinds.
“AFRM continues to execute well, with meaningful share gains, Affirm Card momentum, and strong 0% APR trends,” Peller wrote. He added that the company’s potential to expand its international footprint and diversify further into new verticals could drive additional upside. “International expansion…also remains a key opportunity, along with further vertical diversification (including into services),” he noted.
“While there has been extensive focus on the BNPL competitive landscape, AFRM continues to meaningfully take share (both with existing merchants and new logos) while seeing healthy user growth and increasing transaction frequency… Looking longer term, other growth drivers include Affirm Edge and agentic commerce.”
Wolfe Research’s assessment aligns with the broader consensus on Wall Street. Of the 37 analysts covering Affirm Holdings, 29 maintain a buy or strong buy rating, according to LSEG data.
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