Goldman Sachs initiates coverage on Affirm with Buy rating

Affirm (AFRM) received a Buy rating with a $42 price target from Goldman Sachs after analysts resumed coverage on the fintech company on Monday. The Goldman Sachs team called the buy now, pay later (BNPL) loan company the "leading provider of modern credit solutions."

Market Domination Hosts Julie Hyman and Josh Lipton report more on the bullish call as Affirm shares jump in Monday's session.

For more expert insight and the latest market action, click here to watch this full episode of Market Domination.

This post was written by Melanie Riehl and updated by Luke Carberry Mogan.

Catch up with Yahoo Finance's latest reporting on Affirm:

Affirm’s founder talks Apple partnership, Elon Musk, & AI

Apple dumps 'Apple Pay Later' for new BNPL partnerships

Affirm CEO shares thoughts on competition with Klarna

Affirm stock rallies on the back of Apple Pay partnership

Video transcript

Firm getting a bullish call from Goldman Sachs after shift in analyst coverage.

The firm upgrading the buy now pay later stock from neutral to buy, calling it the quote leading provider of modern credit solutions that stock up over 7% here in the market.

Open Young finds J is here with me now, about hour after the open here.

Jared, I'm still catching up, but it's interesting with a firm.

I mean, the stock is down over 30% year to date here, but see some upward movement given some of these upgrades and also the combination of the the partnership with Apple as well, right?

Yeah.

It's been kind of a tough year for a firm and certain payment processors, but not all.

Um and it's interesting this comes after a deal with Apple, so they got a little tie up there.

Um, online transaction in the US are going to be a bigger factor in their earnings going forward, and Goldman is specifically citing their underwriting processes.

Um, they look at this apple, uh, deal, and they're looking at gross merchandise volume, and specifically they want to see that growth rate over 15% over time.

And if you dial down to shorter time frames, I actually have a separate analysis by Bloomberg Intelligence saying that, uh, that Apple is going to help a firm push past 26 27% gross merchandise volume over time so specifically 29% this year.

And that is based on consensus of 23.7.

So that's quite a jump there.

What you're looking at on your screen is the intraday price action.

Here is year to date that you were just talking about Mattie and you can see indeed under by about 34%.

And I'll just put a max chart because this is a company that came to market in 2021.

It was a tough time because 2022 was that huge, huge bear market where so many disruption stocks, which I would I would include this a payment disruptor as well.

We got caught up in that, but you can see over the last year been making some movements, uh, basically doubling its share price.

So still in the weeds, with respect to its 2021 high, but moving in the right direction