By Sam Boughedda
Shares of Affirm Holdings Inc (NASDAQ:AFRM) were reiterated with a Buy rating and a $45 per share price target by a BofA analyst on Thursday ahead of its earnings release.
The analyst said the company's momentum likely continued into the fiscal fourth quarter.
"We see modest upside to all key metrics – gross merchandise volume (GMV), revenue, and revenue less transaction expense – with perhaps the biggest beat likely on GMV, consistent with mobile app data we track from Sensor Tower," said the analyst.
He added: "For F4Q GMV/revenue, the Street is modeling $4.07B/$356M, which is modestly above current guidance of $3.95B-$4.05B/$345M-$355M and BofA at $4.02B/$353M, respectively. For revenue less transaction expense, consensus at $167M is slightly ahead of guidance of $160M-$165M and our forecast of $162M, representing ~4.0% of GMV."
The analyst concluded that consumer credit commentary from banks and card issuers was generally favorable in the company's second-quarter earnings, and they believe investors will be looking for Affirm to reiterate that credit remains in check.