Affirm Holdings (AFRM) AI Stock Analysis

• Market Cap: $15.95B
• Dividend Yield: N/A
• Average Volume (3M): 7.14M
• Price to Earnings (P/E): 58.9
• Beta (1Y): 2.53
• Revenue Growth: 37.00%
• EPS Growth: N/A
• Country: US
• Employees: 2,006
• Sector: Technology
• Sector Strength: 88
• Industry: Software - Infrastructure
• EPS (TTM): 0.37
• Shares Outstanding: 292,409,880
• 10 Day Avg. Volume: 7,459,372
• 30 Day Avg. Volume: 7,141,630
• PEG Ratio: -3.90
• Price to Book (P/B): 7.27
• Price to Sales (P/S): 6.92
• P/FCF Ratio: 37.10
• Enterprise Value/Market Cap: 0.97
• Enterprise Value/Revenue: 4.18
• Enterprise Value/Gross Profit: 6.18
• Enterprise Value/Ebitda: 15.66
• 1Y Price Target: $84.80
• Price Target Upside: 79.93% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 23
• EPS Forecast (FY): 1.08
• Revenue Forecast (FY): $4.13B

• Rating: 59 Neutral
• Price Target: $49.00 ▲(3.97% Upside)
• Action: Reiterated Date: 02/06/26
• Date: Action: Reiterated 02/06/26

The score is supported by improving profitability and strong recent cash generation, reinforced by a constructive earnings call highlighting product/GMV momentum and better funding execution. These positives are tempered by a weak technical setup (price below key moving averages with negative MACD), a high P/E with no dividend support, and fundamental risk factors including TTM revenue decline and elevated leverage.

Positive Factors

Strong Cash Generation

Sustained positive operating and free cash flow provides durable internal funding for product investment, marketing, and ABS liquidity needs. High-quality cash generation versus earnings reduces reliance on equity raises and supports multi-quarter execution of growth and margin initiatives.

Improving Profitability & Margins

A swing to positive net margins with very strong gross margins reflects durable unit economics and pricing power in core BNPL products. This margin profile supports reinvestment, buffers credit loss volatility, and enables sustainable operating-margin expansion over the medium term.

Product & Merchant Momentum

Rapid card adoption, accelerating merchant count, wallet partnerships and early AI-led product wins deepen engagement and diversify revenue mix. These structural product and distribution gains lower concentration risk and improve customer lifetime value materially over several quarters.

Negative Factors

Top-Line Volatility

A meaningful TTM revenue decline despite margin improvement signals fragility in growth cadence and reliance on a few large flows. Persistent top-line softness could limit scale benefits, constrain marketing reinvestment, and make multi‑quarter growth guidance harder to achieve.

Elevated Leverage

Material leverage raises funding-cost and refinancing sensitivity, reducing balance-sheet flexibility to pursue opportunistic investments or absorb ABS market stress. Elevated debt increases interest expense risk and constrains capital allocation during economic or credit slowdowns.

Regulatory & Charter Uncertainty

Emerging regulations and an uncertain industrial bank charter create multi‑jurisdiction compliance costs, potential caps on fees, and longer underwriting constraints. Regulatory change can structurally compress take‑rates and raise operating complexity over many quarters.

Affirm Holdings Business Overview & Revenue Model

Company Description

Affirm Holdings, Inc. operates a platform for digital and mobile-first commerce in the United States and Canada. The company's platform includes point-of-sale payment solution for consumers, merchant commerce solutions, and a consumer-focused app. Its payments network and partnership with an originating bank, enables consumers to pay for a purchase over time with terms ranging from one to forty-eight months. As of June 30, 2021, the company had approximately 29,000 merchants integrated on its platform covering small businesses, large enterprises, direct-to-consumer brands, brick-and-mortar stores, and companies. Its merchants represent a range of industries, including sporting goods and outdoors, furniture and homewares, travel, apparel, accessories, consumer electronics, and jewelry. The company was founded in 2012 and is headquartered in San Francisco, California.

How the Company Makes Money

Affirm generates revenue primarily through merchant fees and consumer interest income. When consumers use Affirm's payment solutions at partner merchants, Affirm charges these merchants a percentage of the transaction amount, typically ranging from 2% to 6%. Additionally, Affirm earns interest on loans provided to consumers when they choose to finance their purchases over time. The company offers different repayment plans, and the interest rates can vary based on creditworthiness and the terms of the loan. Significant partnerships with major retailers and e-commerce platforms enhance Affirm's market reach and drive transaction volume, further contributing to its revenue streams.

Affirm Holdings Financial Statement Overview

Summary

Improving fundamentals with a swing to profitability (TTM net margin ~6.7%) and strong gross margins (~68%), plus solid operating cash flow (~$833M TTM) and firmly positive free cash flow (~$619M TTM). Offsetting these positives are a TTM revenue decline (~15.6%), recently lower TTM free cash flow (~19.5%), and a leveraged balance sheet (debt-to-equity ~2.4–2.6x), which constrains flexibility.

Income Statement

AFRM shows a clear profitability inflection: annual results moved from deep losses in 2022–2024 to positive net income in 2025, and TTM (Trailing-Twelve-Months) net margin is positive (~6.7%) with strong gross margins (~68%). Revenue expanded strongly through 2025 annual, but TTM (Trailing-Twelve-Months) revenue is down (~15.6%), signaling a near-term growth slowdown. Overall, profitability and margin structure are improving, but top-line volatility keeps the score from being higher.

Balance Sheet

The balance sheet is supported by a growing equity base (roughly $2.6B in 2021 to ~$3.5B in TTM (Trailing-Twelve-Months)) and a return on equity turning positive in TTM (~7.8%) after several loss years. However, leverage is a key risk: debt relative to equity remains elevated (roughly 2.4–2.6x in recent periods), and total debt spiked in 2025 annual versus TTM, highlighting potential variability in funding needs and balance sheet structure. Improving returns are a plus, but leverage keeps financial flexibility more constrained.

Cash Flow

Cash generation has strengthened materially versus earlier years: operating cash flow is solid in 2024–2025 and TTM (Trailing-Twelve-Months) (~$833M), and free cash flow is firmly positive in the latest periods (~$619M TTM). Cash flow also looks high-quality versus earnings, with operating cash flow running well above net income in the latest periods. The main watch-out is momentum: TTM (Trailing-Twelve-Months) free cash flow is down (~19.5%), suggesting some recent pressure despite the improved baseline.

Breakdown	TTM	Jun 2025	Jun 2024	Jun 2023	Jun 2022	Jun 2021
Income Statement
Total Revenue	3.72B	3.22B	2.32B	1.59B	1.35B	870.46M
Gross Profit	2.52B	2.18B	1.48B	714.82M	772.84M	547.55M
EBITDA	992.85M	711.99M	-2.23M	-671.60M	-602.41M	-370.69M
Net Income	282.33M	52.19M	-517.76M	-985.35M	-707.42M	-441.03M
Balance Sheet
Total Assets	12.96B	11.15B	9.52B	8.16B	6.97B	4.87B
Cash, Cash Equivalents and Short-Term Investments	2.25B	2.23B	2.14B	2.07B	2.85B	1.48B
Total Debt	1.13B	7.85B	6.61B	5.45B	4.14B	1.98B
Total Liabilities	9.41B	8.09B	6.79B	5.62B	4.36B	2.29B
Stockholders Equity	3.55B	3.07B	2.73B	2.53B	2.62B	2.58B
Cash Flow
Free Cash Flow	619.13M	601.72M	290.84M	-108.59M	-273.90M	-213.38M
Operating Cash Flow	833.34M	793.91M	450.14M	12.18M	-162.19M	-193.13M
Investing Cash Flow	-1.92B	-1.08B	-1.33B	-1.65B	-2.01B	-1.02B
Financing Cash Flow	1.44B	751.42M	913.15M	1.35B	2.04B	2.58B

Affirm Holdings Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 47.13
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Positive
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For AFRM, the sentiment is Negative. The current price of 47.13 is below the 20-day moving average (MA) of 56.72, below the 50-day MA of 67.54, and below the 200-day MA of 69.35, indicating a bearish trend. The MACD of -5.68 indicates Positive momentum. The RSI at 26.64 is Positive, neither overbought nor oversold. The STOCH value of 10.21 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for AFRM.

Affirm Holdings Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
XYZ	75 Outperform	$30.99B	10.26	14.78%	―	0.47%	178.05%
FOUR	68 Neutral	$5.17B	27.37	15.52%	―	23.16%	27.38%
PAYO	67 Neutral	$1.79B	26.52	9.79%	―	10.58%	-45.52%
MQ	66 Neutral	$1.83B	-52.07	-4.10%	―	20.11%	-391.61%
Sector *	61 Neutral	$37.18B	12.37	-10.20%	1.83%	8.50%	-7.62%
AFRM	59 Neutral	$15.95B	58.89	8.92%	―	37.00%	―
KLAR	52 Neutral	$9.89B	-17.96	-12.85%	―	―	―

Affirm Holdings Corporate Events

Affirm Grants New Performance-Based PSU Award to CEO

On January 13, 2026, Affirm Holdings’ board approved a new performance stock unit grant of 333,667 PSUs to founder and CEO Max Levchin under the company’s 2012 Stock Plan, structured to vest into Class A common shares based on a mix of time, service and three-year financial performance conditions. The award, aligned with PSU grants made to other executives in September 2025, ties potential share payouts—ranging from 50% to 200% of the granted units—to average performance from July 1, 2025 through the end of the three-year period on two equally weighted metrics: annual growth in revenue less transaction costs and adjusted operating income, with no shares earned until the performance period concludes and vesting contingent on Levchin’s continued service; the grant succeeds a prior value creation award that was established before Affirm’s IPO in January 2021 and expired on January 11, 2026, underscoring the company’s ongoing use of long-term, performance-based equity to align executive incentives with financial outcomes.

The most recent analyst rating on (AFRM) stock is a Hold with a $87.00 price target. To see the full list of analyst forecasts on Affirm Holdings stock, see the AFRM Stock Forecast page.

Affirm stockholders back board, auditors and executive pay

At its annual meeting of stockholders held on December 15, 2025, Affirm Holdings, Inc. reported a quorum representing 93.4% of combined voting power across its dual-class share structure, with Class A shares carrying one vote and Class B shares carrying fifteen votes but voting together as a single class on all matters. Stockholders elected Richard Galanti, Christa S. Quarles and Manolo Sánchez as Class II directors to serve until the 2028 annual meeting, ratified the appointment of Deloitte & Touche LLP as the company’s independent registered public accounting firm for the fiscal year ending June 30, 2026, and approved on a non-binding advisory basis the compensation of the company’s named executive officers, signaling broad shareholder support for the company’s current board composition, governance approach and executive pay practices.

The most recent analyst rating on (AFRM) stock is a Buy with a $95.00 price target. To see the full list of analyst forecasts on Affirm Holdings stock, see the AFRM Stock Forecast page.