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Affirm (NASDAQ:AFRM) stock price is doing well this week as investors cheer the performance of Black Friday and Cyber Monday. The shares surged by more than 11% on Monday to reach its highest point since August 2022. They have jumped by over 243% from the lowest point this year.
Robust weekend shopping
Affirm and other Buy Now Pay Later (BNPL) companies had a strong performance during the Thanksgiving weekend. The most recent results show that Americans boosted their shopping on Black Friday and Cyber Monday.
Black Friday shopping hit a record $8.9 billion, helped by e-commerce, according to a report by Adobe. Other reports showed that companies like Amazon and eBay had strong traffic during the weekend.
A key trend during the weekend was the strength of BNPL, which is one of the top trends in finance. Shoppers spent over $12 billion in BNPL platforms like Affirm and Klarna, a 20% increase from the same period in 2024.
Watch here: https://www.youtube.com/embed/WA1zp8BSmoc?feature=oembedThis performance means that Affirm’s financial results will likely be better than what it estimated when it published its results a few weeks ago.
At the time, Affirm said that its revenue jumped by 37% to $496 million up from $361 million in the same quarter in 2022. Its operating loss also narrowed to $209 million while net loss slimmed to $171 million.
These results meant that the company was growing both its GMV and narrowing its profitability. Analysts believe that the company could continue doing well in the long term as inflation falls.
The most recent results showed that the headline Consumer Price Index (CPI) dropped to 3.2% in October. And with the price of crude oil falling, there is a possibility that inflation will keep falling in the coming months.
Low inflation leads to more spending, which is a positive thing for Affirm and other BNPL companies like AfterPay and Klarna. Most importantly, lower inflation means that the Fed will likely start slashing interest rates in 2024. Lower rates will lead to cheap financing costs for Affirm.
Affirm stock price forecast
Turning to the daily chart, we see that the AFRM share price has done well in the past few weeks. This rally was in line with my last Affirm shares forecast.
In this period, the stock has jumped above the key resistance point at $22.82, the highest point on February 2nd.
The shares have also flipped the key resistance point at $25.70 (19th September high) into a support. Further, the stock has risen above the 50-day and 100-day Exponential Moving Averages (EMA).
The MACD has continued rising and is now above the neutral point. Therefore, the outlook for Affirm shares is bullish, with the next point to watch being at $41.04, the highest swing in August 2022. This price is about 40% above the current level.
The post Affirm stock price forecast: AFRM shares could jump by 40% appeared first on Invezz
