Recent earnings show that the buy now, pay later (BNPL) business model is growing rapidly. One of the most established players in the payments space with BNPL offerings is PayPal NASDAQ: PYPL. The company mentioned in its latest earnings call that payment volume through its BNPL product grew by 20% in Q1. PayPal is putting a significant amount of effort into this area of growth because BNPL customers are particularly active. The company notes that these users spend 33% more on average and conduct 17% more t ...

Momentum investing revolves around the idea of following a stock's recent trend in either direction. In the 'long' context, investors will be essentially be "buying high, but hoping to sell even higher." With this methodology, taking advantage of trends in a stock's price is key; once a stock establishes a course, it is more than likely to continue moving that way. The goal is that once a stock heads down a fixed path, it will lead to timely and profitable trades.Even though momentum is a popular stock char ...

Core Viewpoint - The article discusses the potential resurgence of the bull market, highlighting opportunities in lesser-known tech stocks alongside established names like the Magnificent 7 and leading AI companies [1] Group 1: Under-the-Radar Tech Stocks - Three tech stocks, Sezzle Inc. (SEZL), Pagaya Technologies Ltd. (PGY), and AppLovin (APP), are identified as having significant growth potential and are showing strong momentum [2][3] - These companies are characterized as high-growth innovators with robust growth forecasts and favorable stock price movements, supported by a top Zacks Rank [2] Group 2: Pagaya Technologies Ltd. - Pagaya Technologies operates at the intersection of AI and financial technology, utilizing machine learning to improve credit decision-making and underwriting in consumer lending [4] - Despite a setback following a disappointing Q1 earnings report, Pagaya has shown a strong recovery, with analysts raising earnings forecasts and achieving a Zacks Rank 1 (Strong Buy) [5] - The stock trades at a forward earnings multiple of 8.3x, with projected sales growth of 20% this year and 16% next year, alongside expected earnings growth of 112% in 2025 and 39% in 2026 [6] Group 3: Sezzle Inc. - Sezzle operates in the Buy Now, Pay Later (BNPL) sector, providing flexible financing options while focusing on profitability and disciplined growth [8] - The stock, despite a significant rally, remains attractively valued at 26.9x forward earnings, with projected sales growth of 62% this year and 20.8% next year, and earnings expected to rise 76% in 2025 and 30% in 2026 [9][10] - Sezzle also holds a Zacks Rank 1 (Strong Buy), reflecting a positive earnings revision trend with significant increases in earnings estimates for 2025 and 2026 [10] Group 4: AppLovin - AppLovin provides a mobile app marketing and monetization platform powered by machine learning, aiding app developers in revenue optimization [11] - The company has experienced substantial growth, with recent upward earnings revisions of 19.2% for the current quarter and 12.5% for the full year [12] - Although trading at a premium valuation of 42.5x forward earnings, the growth outlook is strong, with projected sales increases of 24.3% in 2025 and 16.3% in 2026, and earnings expected to grow by 70.6% this year and 44.8% next year [13][16] Group 5: Investment Considerations - For investors seeking high-growth tech exposure beyond major names, Pagaya Technologies, Sezzle, and AppLovin present a compelling mix of momentum, earnings strength, and long-term potential, supported by rising analyst estimates and top Zacks Ranks [17]

Core Viewpoint - Sezzle Inc. (SEZL) shows a significant improvement in earnings outlook, making it an attractive investment option as analysts continue to raise earnings estimates for the company [1][3]. Earnings Estimate Revisions - The upward trend in earnings estimate revisions indicates growing analyst optimism regarding Sezzle's earnings prospects, which is expected to positively impact its stock price [2]. - For the current quarter, Sezzle is projected to earn $0.56 per share, reflecting a 55.56% increase from the previous year [7]. - Over the last 30 days, the Zacks Consensus Estimate for Sezzle has risen by 39.13%, with two estimates moving higher and no negative revisions [7]. - For the full year, the earnings estimate is $3.24 per share, representing a 76.09% increase from the prior year [8]. - The consensus estimate for the current year has also seen positive revisions, with two estimates increasing and no negative changes [8]. Zacks Rank and Performance - Sezzle currently holds a Zacks Rank 1 (Strong Buy), indicating strong agreement among analysts in raising earnings estimates [9]. - The Zacks Rank system has a proven track record, with Zacks 1 Ranked stocks averaging a 25% annual return since 2008 [3]. - Stocks with Zacks Rank 1 and 2 significantly outperform the S&P 500, suggesting a favorable investment environment for Sezzle [9]. Stock Performance - Sezzle shares have increased by 125.6% over the past four weeks, indicating strong investor confidence in the company's earnings growth prospects [10].

However, it's not enough to look at the price change for around three months, as it doesn't reflect any trend reversal that might have happened in a shorter time frame. It's important for a potential winner to maintain the price trend. A price increase of 125.6% over the past four weeks ensures that the trend is still in place for the stock of this company. Moreover, SEZL is currently trading at 98.5% of its 52-week High-Low Range, hinting that it can be on the verge of a breakout. Looking at the fundamenta ...

Group 1 - Sezzle's shares have shown significant volatility, reflected in a high two-year beta of 4.41 [1] - The company has a high short interest of 10.75% and a small free float, indicating potential market concerns [1]

Core Insights - Sezzle's stock surged 51% following strong first-quarter results and an upward revision of guidance [1] - The company reported a 64.1% increase in gross merchandise volume (GMV) to $808.7 million, with customer purchase frequency rising from 4.5 to 6.1 times [3] - Revenue soared 123.3% to $104.9 million, significantly exceeding estimates of $64.8 million [3] - Operating income increased by 260.6% to $49.9 million, resulting in an operating margin of 47.6% [4] - GAAP earnings per share rose from $0.22 to $1.00, surpassing the consensus estimate of $0.32 [4] Company Performance - Sezzle had 658,000 users in the quarter, indicating strong user engagement [4] - CEO Charlie Youakim attributed the success to investments in innovation and consumer experience, leading to increased engagement and performance [5] - The company raised its 2025 net income guidance by nearly 50% to $120 million due to stronger consumer activity and repayment trends [5] Future Outlook - Management increased total revenue growth guidance for the year to 60%-65%, up from a previous estimate of 25%-30% [6] - Expected earnings per share were raised to $3.25 from $2.21 [6] - Sezzle is positioned as a competitive player in the BNPL market, offering unique features such as user control over credit bureau reporting [5] - The stock is considered reasonably valued with a price-to-earnings ratio of 25, suggesting potential for further growth [7]

Core Insights - The Consumer Financial Protection Bureau (CFPB) will not classify buy now, pay later (BNPL) companies like credit card networks, allowing Sezzle to focus on consumer engagement and platform innovation [1] Financial Performance - Sezzle reported a gross merchandise volume (GMV) increase of 64.1% year over year, reaching $808.7 million, driven by higher subscriber and user engagement [4] - Total revenue rose by 123.3% to $104.9 million, achieving a new quarterly high, while net income increased over fourfold to $36.2 million, equating to $1.00 per diluted share [4] - Operating expenses decreased to 52.4% of revenue, an 18.2-point improvement from the previous year [5] - The company raised its 2025 net income forecast by nearly 50% to $120 million, reflecting management's confidence in sustaining growth [6] Product and Service Innovations - Sezzle introduced several new features, including a Pay-in-5 beta program, enhanced shopping tools, and a financial education module called Money IQ [2][3] - The Pay-in-5 feature is expected to grow, currently accounting for under 10% of volume but showing positive initial results [11] Market Strategy - The company is focusing on enterprise-level merchants and exploring new verticals like grocery, where BNPL adoption has been slower [7] - Sezzle's On Demand product is experiencing monthly sequential growth, indicating strong consumer interest and engagement [8] Customer Engagement - Consumer purchase frequency increased to 6.1 times per year from 4.5, indicating stronger user engagement and higher lifetime value [5] - The expansion of the merchant network and online communities aims to enhance customer loyalty and financial literacy [3]

Financial Performance - Sezzle's GMV增长了64.1%[10] - Total Revenue同比增长123.3%[10] - 净利润为3620万美元，净利润率为34.5%[10] - 公司将全年净利润预期从8040万美元上调至1.2亿美元，每股收益从2.21美元上调至3.25美元[10] - Total Revenue Less Transaction Related Costs占总收入的70.4%[10] User Engagement - Monthly On-Demand & Subscribers (MODS)达到65.8万，同比增长77.4%[10] - 平均季度购买频率为6.1次，高于去年同期的4.5次[10] Product Expansion - 公司推出了Pay-in-5 (beta), Sezzle Balance, Money IQ等新产品[10] - 改进了购物体验，包括Wishlist, Price Comparison & Auto-Couponing (beta)等功能[10] Balance Sheet - 现金和现金等价物总额为1.20869亿美元[61]

Financial Data and Key Metrics Changes - The company reported a 123% year-over-year increase in revenue, reaching $104.9 million [18] - Adjusted net income grew 286% year-over-year to $36.1 million, with a net income margin of 34.5% [18][23] - Gross margin for the quarter was 70.4%, reflecting strong unit economics [8][22] Business Line Data and Key Metrics Changes - Gross Merchandise Volume (GMV) rose 64% year-over-year, significantly outpacing the overall BNPL industry [8] - Monthly on-demand users and subscribers (referred to as mods) increased by 77% year-over-year to 658,000 [8][14] - The average quarterly purchase frequency increased from 4.5 to 6.1 times per quarter [15] Market Data and Key Metrics Changes - The company continues to represent less than 10% of the overall payments market, indicating significant growth potential [4] - The take rate increased to 13% at GMV, benefiting from strong subscriber engagement and the partnership with WebBank [19] Company Strategy and Development Direction - The company is focusing on expanding its product offerings, including new features like Pay in Five and auto couponing to enhance consumer experience [11][60] - There is a strategic push towards enterprise-level merchants and new categories such as grocery and bills, which have been slower to adopt BNPL [30] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the business model's strength amid market volatility, highlighting improved margins and rapid portfolio turnover [21] - The company raised its 2025 guidance, projecting revenue growth of 60% to 65% and earnings per share of $3.25, reflecting strong demand and credit performance [24][26] Other Important Information - A $50 million share repurchase program was announced, along with a six-for-one stock split to enhance liquidity [12] - The company has seen a significant increase in cash from operations, growing nearly $20 million year-over-year to $58.8 million [24] Q&A Session Summary Question: Can you tell us about your funnel of new merchants? - The company is focusing on enterprise-level merchants while also engaging with mid-sized merchants, expanding into new categories like grocery and bills [29][30] Question: What is the frequency or optimism you're seeing from on-demand products? - Monthly sequential growth indicates strong performance, with a lower barrier to entry for consumers [33] Question: Can you quantify the financial benefit from the WebBank partnership? - The partnership has improved revenue yield as a percentage of GMV, allowing for optimized product offerings [42] Question: What contributes to the stickiness of monthly subscribers? - The ease of use and seamless integration of the product into consumer shopping habits contribute to high retention rates [44][46] Question: How is the company managing credit quality? - The company maintains a focus on ROI and gross margins while being open to adjusting credit quality to support growth [50][52] Question: Can you describe the new features Pay in Five and auto couponing? - Pay in Five allows for an additional payment option, while auto couponing aims to enhance customer value and retention by providing unexpected savings [56][60]