Key Points Financial stocks continue to deliver returns for investors, since everyone needs to use and manage money. Sezzle continues to gain market share in the BNPL industry and looks attractive after the recent correction. Robinhood has multiple high-growth revenue opportunities and continues to attract new investors. 10 stocks we like better than Sezzle › No matter what innovations reach the marketplace, people will exchange money to buy goods and services. Financial institutions and fintech ...

Key Takeaways Affirm partners with Pacsun to offer installment payments during the holiday shopping season.Shoppers can choose interest-free biweekly plans or monthly options of up to 24 months.AFRM expects December-quarter revenues of $1.03-$1.06B as holiday BNPL volume rises.Affirm Holdings, Inc. (AFRM) recently partnered with Pacsun, a youth-focused fashion retailer, to power pay-over-time options at checkout. Shoppers can split purchases into installments directly using Affirm when buying Pacsun’s colle ...

Ovanti Ltd (ASX:OVT) is in talks with Nasdaq-listed Miluna Acquisition Corp (MMTXU) to effectively stage a backdoor listing on the world’s biggest technology index through what is called a “SPAC deal.”Listen to the HotCopper podcast for in-depth discussions and insights on all the biggest headlines from throughout the week. On Spotify, Apple, and more.Disclaimer: This content has been prepared as part of a partnership with Ovanti Ltd and is intended for informational purposes only.Ovanti U.S.’s flagship BNP ...

Core Insights - Klarna is expanding its partnership with Blackhawk Network to enhance gift card purchasing options for consumers ahead of the holiday season [2][3] - The collaboration allows consumers to purchase digital gift cards from over 350 brands using Klarna's payment options, which include Pay in Full, Pay in 4, and Financing [3][4] Company Developments - Klarna's chief commercial officer emphasized the importance of flexibility and control for consumers in gift card purchases as the company continues to grow in the U.S. market [2] - The partnership aligns with the rising popularity of digital gift cards, which can now be added to digital wallets like Apple Wallet and Google Wallet [5] Industry Trends - The demand for digital gift cards is increasing, with 81% of consumers having purchased a gift card in the previous year, marking a 6% increase from the prior year [5] - Klarna is evolving into a neobank, supported by a global retail payments network, with a revenue mix that includes merchant fees, interest income, and value-added services [6]

Core Viewpoint - Sezzle has experienced significant growth but has recently faced a sharp decline in stock price, presenting a potential buying opportunity amidst broader market concerns about the fintech sector and credit risks [1][2][3]. Company Performance - Sezzle's stock fell 43% since September 9, underperforming compared to other fintech stocks [3]. - Despite the stock's decline, Sezzle reported strong third-quarter results, with gross merchandise volume increasing by 58.7% to $1 billion and revenue rising by 67% to $116.8 million [8]. - Adjusted EBITDA rose 75% to $39.6 million, and adjusted earnings per share increased from $0.47 to $0.71 [9]. Market Position and Strategy - Sezzle operates in the buy now, pay later (BNPL) space, offering a "pay in four" feature and generating revenue primarily from merchants through a 6% processing fee plus $0.30 per transaction [9]. - The company positions itself as more user-friendly and less predatory than competitors, implementing measures to limit credit risk by cutting off users who miss payments [10]. Financial Metrics - Sezzle's current market capitalization is approximately $2 billion, with a forward P/E ratio of 16 based on an updated adjusted EPS of $3.38 for the year, indicating a potentially attractive valuation for a high-growth company [12]. - The provision for credit losses doubled to $32.2 million in the third quarter, reflecting rising credit risk in the current macroeconomic environment [13]. Future Outlook - If Sezzle can navigate the current market volatility, there is potential for significant stock appreciation, with a 10x gain considered possible if the company maintains its growth trajectory [14].

Core Insights - The Buy Now, Pay Later (BNPL) industry is experiencing a pivotal moment, particularly for Affirm, as it prepares to report its fiscal Q1 2026 earnings, raising investor questions about the timing for buying or selling [2][3] Financial Performance - Affirm is set to report fiscal Q1 2026 results, covering the period from July to September 2025, with key metrics including revenue growth, earnings per share, gross merchandise volume (GMV), credit quality, and the performance of the Affirm Card, which saw a 97% increase in active users to 2.3 million in Q4 [3] - For the fiscal year ending June 30, 2025, Affirm achieved its first-ever full-year GAAP net income of $52.19 million, a significant turnaround from the previous year's net loss [8] - The company reported a 43% year-over-year increase in GMV during its strong fiscal fourth quarter, marking its first quarterly operating profit [9] Market Conditions - Recent Federal Reserve rate cuts have eased funding pressures for BNPL players, improving margins and funding flexibility for Affirm [4] - Regulatory risks have diminished, as the CFPB reversed its earlier decision to classify BNPL lenders as "credit card providers," leading to a more favorable operating environment for Affirm and its peers [5] Stock Performance - Affirm shares have increased by 67.1% year-to-date in 2025, with a 52-week trading range between a low of $30.90 and a high of $100.00 [8] - The stock opened at $71.14 but declined to a low of $66.24 during the session at the time of writing [9] Industry Comparables - Klarna (KLAR), a relevant comparable in the BNPL space, has seen its stock price decline to around $35.66, more than 10% below its $40 IPO price, despite analysts maintaining a "Buy" consensus [10][12] Future Outlook - With high interest rates and regulatory uncertainties largely resolved, the BNPL industry is shifting focus towards diversification, with major players exploring traditional banking services [13]

Core Insights - Affirm Holdings, Inc. is a significant player in the buy now, pay later (BNPL) sector, with quarterly earnings set to be released on November 6, 2025, and Wall Street estimates earnings per share (EPS) at $0.10 and revenue at approximately $882 million [1] - The Internet Software sector, including Affirm, is expected to benefit from advancements in artificial intelligence, cloud computing, and automation, contributing to a projected revenue increase of 26.7% year-over-year, reaching $885 million [2] Financial Performance - Affirm is anticipated to report a revenue increase of 26.7% year-over-year, reaching $885 million [5] - The company has a strong liquidity position with a current ratio of approximately 54.19, indicating ample current assets to cover liabilities [3][5] - However, Affirm's debt-to-equity ratio is about 2.56, suggesting a significant reliance on debt financing relative to equity [3][5] Market Challenges - Despite the positive outlook, Affirm faces challenges from high interest rates and market volatility, which could moderate revenue growth [3][5] - Investors should closely monitor management's discussion during the earnings call to assess the sustainability of price changes and future earnings projections [4]

Core Insights - The UK BNPL (Buy Now, Pay Later) market is undergoing significant regulatory changes aimed at increasing consumer protection and lender accountability [2][6][19] - The Financial Conduct Authority (FCA) will impose stricter checks and regulations on BNPL providers, aligning them more closely with traditional lending practices [3][6][10] Regulatory Changes - Starting mid-2026, BNPL providers will be required to conduct more detailed affordability checks for customers, moving away from the current practice of minimal checks based on self-reported income and expenditure [1][6][8] - The FCA will oversee the BNPL market, ensuring that customers receive the same protections as traditional borrowers, including the ability to escalate complaints to the financial ombudsman [6][11] Market Dynamics - The BNPL market has seen substantial growth, with approximately 11 million UK adults using BNPL products in the year leading up to May 2024, an increase from around 8.8 million two years prior [5] - The rising cost of living has heightened demand for BNPL services, as they provide a means for consumers to manage larger, unexpected expenses [4][5] Business Implications - Companies will need to adapt their business models to comply with new regulations, which may include obtaining consumer credit licenses and implementing more rigorous application processes [13][15] - Providers that can effectively integrate regulatory compliance with innovative solutions are likely to thrive in the evolving financial landscape [18][19] Consumer Impact - Enhanced checks are expected to reduce the number of customers approved for BNPL lending who cannot afford repayments, thereby decreasing the risk of unmanageable debt [10] - Firms will be required to communicate with customers regarding missed payments and direct them to debt advice services if necessary, reinforcing a customer-centric approach [12][16]

Core Insights - Klarna Group, a buy now, pay later (BNPL) financial solutions company, has seen its stock price decline to $37.84, below its IPO price of $40, despite initial post-IPO trading reaching $52 [1][2] - Analysts from major Wall Street firms have initiated coverage with optimistic ratings, indicating a consensus price target of approximately $50 per share, suggesting potential for recovery [2][3] Company Performance - Klarna has achieved a 38% year-over-year growth in its U.S. business, with gross merchandise volume (GMV) exceeding $31 billion in the latest quarter [3] - The company boasts a user base of over 111 million active users, significantly outpacing its closest competitor, Affirm Holdings, which has around 23 million customers [3] Industry Context - The BNPL industry is characterized by narrow margins and high transaction volume reliance, making it a challenging environment for companies like Klarna [4] - Regulatory oversight poses additional challenges, with potential legislative changes impacting business operations [4] Growth Opportunities - Klarna's growth strategy includes regional expansion and increased merchant adoption globally, particularly in Europe where there is still room for growth [6] - The introduction of the Klarna Card in the U.S. is expected to attract new customer segments [6] Technological Advancements - The integration of AI is anticipated to enhance Klarna's BNPL business, particularly in improving transaction margins, which could significantly boost profitability [7] Future Prospects - Klarna's stock forecast indicates a potential upside of 31.18%, with a 12-month price target of $49.64 based on 18 analyst ratings [8] - The company is exploring additional revenue streams in payments and advertising, leveraging its large user base to penetrate these markets [9]

Group 1 - The recommendation for Klarna (NYSE: KLAR) is a buy rating due to its strong network advantage and powerful flywheel effect driving robust growth [1] - Klarna's US growth strategy is anchored by major initiatives that support its expansion [1] - The investment approach focuses on long-term investments while incorporating short-term shorts to uncover alpha opportunities, emphasizing bottom-up analysis of individual companies [1] Group 2 - The investment duration is medium to long-term, aiming to identify companies with solid fundamentals, sustainable competitive advantages, and growth potential [1]