Core Viewpoint - Klarna Group's stock has seen a positive response from analysts following its IPO, with a majority initiating coverage with favorable ratings, although the stock remains below its initial trading highs [1][2]. Analyst Coverage - At least 14 analysts have initiated coverage of Klarna stock, with 10 providing buy-equivalent ratings and the remainder offering neutral views [2]. - UBS analyst Timothy Chiodo set a price target of 48, indicating an 18% upside from Klarna's price at the start of trading [3]. - Wedbush Securities analyst Scott Devitt also initiated coverage with a buy rating and a price target of 50 [4][5]. - Bernstein analyst Harshita Rawat took a neutral stance with a price target of 45, noting that Klarna's U.S. business growth is crucial against competitors like Affirm [6][7]. Business Model and Market Position - Klarna operates as a global commerce enabler focused on Buy-Now-Pay-Later (BNPL) services, primarily in e-commerce, with potential for in-store expansion [4]. - The BNPL industry presents attractive unit economics, with Klarna earning an average gross profit take rate of approximately 1.1% to 1.2% of gross merchandise value [4]. - Klarna's total revenue for the year ending June 30 was reported at $3 billion, reflecting a 17% year-over-year growth, despite a net loss of $100 million, which is a 29% year-over-year improvement [9]. IPO Performance - Klarna launched its IPO on September 10, pricing shares at 40, raising $1.37 billion, with shares initially surging to 57.20 before closing at 45.82, a 14.6% gain [8]. - Following the IPO, Klarna's stock experienced volatility but has gained 15% in October, including recent trading gains [8].
Klarna Stock Rallies As Analysts Offer Bullish Views On The Fintech IPO Stock