Affirm Holdings (AFRM, Financial) saw a small boost on Wednesday — climbing almost 3% — after Evercore ISI made a bold call that caught some investors off guard.
Analyst Adam Frisch admitted it might sound a bit out there to be optimistic about a consumer credit stock right now. “Call us crazy,” he said, but he believes Affirm has better risk controls than its competitors and enough momentum to grow its user base over time, even in a tough market.
That optimism comes after a rough stretch. Just last week, Affirm had one of its worst trading weeks ever, largely because investors are worried consumers will start pulling back on discretionary spending — something that tends to hurt buy-now-pay-later platforms like Affirm.
Still, Frisch thinks the company can hold its ground. With shoppers looking for ways to manage spending more carefully, services like Affirm could become more appealing. And when the economy stabilizes, he believes Affirm will be well-positioned to benefit from renewed consumer demand.
Even so, the risks are real. Klarna, one of Affirm's competitors, recently delayed its IPO, signaling the market's caution. But Evercore sees the current dip as a possible buying opportunity.
