Affirm: The Valuation Is Still Too High, Even After It Was Cut In Half

Apr. 20, 2021 4:44 AM ETAffirm Holdings, Inc. (AFRM)PYPL, SQ34 Comments

Summary

  • Affirm Holdings was one of the hottest public offerings at the start of the year.
  • I was very cautious and, even after the share was cut in half, the valuation still looks quite high, certainly given the deterioration in growth rates and margins.
  • While the buzz remains good, I think the valuation is still not compelling here despite the move, with shares still up significantly from the IPO level.
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Affirm (NASDAQ:AFRM) went public early this year, as I reviewed the investment thesis on the name, as I came to conclude that Affirm was only the most recent high-flier in a very hot IPO market.

Affirm's shares saw great momentum, almost

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This article was written by

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The writer is a long term value investor and M.Sc graduate in Financial Markets with over 10 years experience. Value can be found in both long and short ideas and uses options to enhance the risk-return profile of investment ideas. Disclaimer: This article provides opinions and information, but does not contain recommendations or personal investment advice to any specific person for any particular purpose. Do your own research or obtain suitable personal advice.

Disclosure: I/we have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

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