These Fintech Stocks Could Be The Real Winners Amid Trump's Affordability Push, Says Citi - Block (NYSE:XYZ)

Core Viewpoint - The U.S. financial technology sector is poised for growth as President Trump's focus shifts to affordability, potentially benefiting fintech companies over traditional lenders [1][2]. Fintech Sector Opportunities - Companies like Affirm Holdings Inc, SoFi Technologies Inc, and Block Inc are well-positioned to capitalize on the affordability trend, according to Citigroup [3]. - Other potential beneficiaries include Toast Inc and Shopify Inc, which are also highlighted for their consumer-friendly services [3]. Traditional Lenders' Response - Traditional lenders initially experienced a rally following Trump's return to the White House, anticipating a more lenient regulatory environment. However, the renewed focus on affordability may shift investor attention towards fintech challengers [4]. Fintech Growth Metrics - Block reported over $200 billion in global lending through its credit products, indicating significant growth in the fintech sector [5]. - SoFi announced a $1.5 billion fundraising plan aimed at enhancing its capital position and supporting future growth [5]. Mixed Outlook on Specific Companies - Kerrisdale has expressed concerns about Affirm, labeling it a "Buy Now, Cry Later" story, suggesting that its rapid growth may reflect underlying risks similar to past subprime lending failures [6]. - Affirm's growth of over 30% in gross merchandise volume since 2022 is noted, but concerns about weakening credit quality due to high-interest rate lending are raised [6]. Reactions to Affordability Initiatives - Trump's affordability initiatives, including blocking institutional investors from acquiring single-family homes, have received mixed reactions, with some praising the efforts while others warn of potential market instability [7]. - The proposed nationwide 10% cap on credit card interest rates could limit access to credit, potentially hindering consumers' ability to build credit and pushing them towards less regulated options [8]. Price Performance - Over the past year, SoFi and Affirm Holdings saw stock price increases of 48.32% and 29.05%, respectively, while Block's stock declined by 25.64% [9].