Puts now, handys later? Affirm earnings 2/10
Just got an email from Citi card offering BNPL with Amazon (6.73% APR, payment plans from 3 to 48 months depending on the purchase amount). This got me thinking about AFRM again.
I held AFRM last year and was saved by the Amazon partnership announcement (sold immediately after, which was too soon, still had PTSD from RKT bags). Growth stocks have largely been profits or bust this year, so even though AFRM has taken a huge dump, I’m guessing there’s more pain to come. Here’s my shitty DD:
-Last September, Credit Carma reported 35% of BNPL customers were late on one or more payments. Last earnings from AFRM said they had about 5% delinquency. My guess is the delinquency rate has risen.
-The Amazon partnership probably won’t be as great as assumed. Amazon earnings were ok, but the $20 rise in Prime membership made AMZN pump. AFRM surely gained revenue, but lately the market doesn’t care about revenue increases.
-Stimmies ran out Q4 last year. Possibly more revenue for AFRM, but also more delinquencies.
-P/S still high at around 16.5
-Statista says about 55% of Amazon Prime subscribers make more than 75k a year. BNPL is mostly geared toward lower income buyers with no credit cards. On top, Amazon has offered payment plans itself for some time. Maybe the partnership wasn’t that valuable.
On the flip side AFRM could post a profit, absolutely crush revenue, or announce they’re being bought out by AMZN. Here’s to hoping I can beat the IV crush. If not, maybe Russia invades Ukraine or some shit.
2/18/22 P at $60, $55, $50.
Submitted February 07, 2022 at 09:47PM by Omnipotent-Ape
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