Affirm (AFRM, Financial) just turned heads with a 10.5% stock jump, thanks to a game-changing deal with Priceline. The expanded partnership makes Affirm the go-to “pay-over-time” provider for Priceline Partner Solutions, giving travel brands—think airlines, hotels, cruises—the ability to add flexible payment options at checkout. It's a smart move for both sides: Affirm reported 25% growth in its travel segment last quarter, proving that travelers love spreading out payments without nasty surprises like hidden fees. And Priceline? They're doubling down on giving partner brands tools to meet evolving customer needs.
But here's the real kicker: Affirm's perfectly positioned to ride the wave of lower borrowing costs as the Federal Reserve cuts interest rates. With BNPL gaining steam, analysts are bullish. Heavy hitters like Morgan Stanley, BTIG Research, and Wells Fargo have all raised price targets, some as high as $68. It's no wonder. Affirm's gross merchandise volume skyrocketed 35% to $7.6 billion last quarter, while revenue climbed 41% to $698 million. Sure, the company is still posting a net loss ($100 million), but that's a massive improvement from last year's $171 million black hole.
Here's why you might want to add Affirm to your portfolio: it's not just about today's numbers; it's about tomorrow's dominance. Partnerships with Amazon, Apple Pay, and now Priceline lock Affirm in as the BNPL leader, owning a solid 34% of the U.S. market. As funding costs drop and e-commerce keeps expanding, Affirm's growth story is only gaining momentum. For investors who can stomach a little risk, this could be your shot at catching a rising star before profitability kicks in.
