Affirm Debit+ Card Receives Positive Analyst Commentary

Affirm Holdings Inc. (AFRM) experienced a surge in premarket trading on Tuesday, with shares rallying over 5%. This increase came after Mizuho analyst Dan Dolev provided favorable commentary on the company’s Debit+ debit-card business. Dolev highlighted the “promising” Google search trends for Affirm’s debit-card product, which offers the convenience of splitting purchases into manageable installments.

Drawing a comparison to Square’s Cash Card, Dolev noted that the recent surge in searches for Affirm’s Debit+ card resembles the buzz that surrounded Square’s card during its early days. Dolev predicted that if Affirm’s Debit+ card follows a similar trajectory to Square’s Cash Card, it could raise the company’s medium-term compound annual growth rate for gross merchandise volume from a mid-20% figure to a mid-30% one.

Despite the potential dilution of revenue less transaction costs (RLTC) as a percentage of GMV, Dolev believes that the incremental volume and revenue growth resulting from the Debit+ card should serve as positive catalysts and help offset any potential sales headwinds from upcoming student loan refinancing.

On Monday, Affirm shares saw an increase of over 8%. It is worth noting, however, that these gains followed a decline of more than 15% across the three previous sessions.