Affirm (AFRM) Stock Forecast & Price Target

Affirm Holdings is positioned for continued growth with anticipated transaction volume reaching approximately $36 billion in fiscal 2025, primarily driven by its interest-bearing loans, which constitute over 70% of its revenue. The company's superior value proposition for both merchants and consumers is expected to foster significant market share gains and robust volume growth. Moreover, strong credit performance and the potential to secure a bank charter could further reduce funding costs and enhance earnings per share, underlining Affirm's positive outlook.

Affirm Holdings operates in a highly competitive buy-now, pay-later industry, facing challenges such as potential customer attrition and difficulty in attracting new merchant partnerships, which could adversely affect growth. The reliance on various funding sources poses significant risks; any unfavorable changes in funding agreements or increased credit losses amid macroeconomic concerns could pressure revenue and earnings per share growth. Additionally, projections for fiscal year 2026 raise concerns, with forecasts for net revenue yield appearing overly optimistic, compounded by high funding costs related to regulatory delays on the company's industrial loan company (ILC) application.