Once one of the market's hottest BNPL names, Sezzle Inc. (NASDAQ:SEZL) has tumbled roughly 60% in less than half a year, a collapse that's now pushing the stock potentially into value territory for the first time in a long while.Operating in an increasingly crowded U.S. online credit market alongside rivals such as Affirm Holdings Inc. (NASDAQ:AFRM) and Klarna Group Inc. (NYSE:KLAR) , the company went public on Australia's ASX in 2019 at A$1.22, or roughly $0.84 per share, before delivering a staggering 22, ...

Core Insights - The alternative lending market in Africa is projected to grow at a compound annual growth rate (CAGR) of 14.8%, reaching a market value of US$4.8 billion by 2025 [1] - The market has experienced robust growth from 2020 to 2024, with a CAGR of 14.7%, and is expected to continue growing at a CAGR of 14.2% from 2025 to 2029, reaching approximately US$8.1 billion by the end of 2029 [2] Market Overview - The report provides a detailed analysis of the alternative lending industry in Africa, covering over 100 key performance indicators (KPIs) such as loan disbursement value, volume, average loan ticket size, and penetration rate [3] - Africa's alternative lending space is evolving with trends such as Buy Now, Pay Later (BNPL) growth, alternative-data underwriting, and institutional capital inflows [4] BNPL and Embedded Credit - The BNPL market in Africa is projected to grow annually, particularly in digitally connected economies, with more merchants integrating installment financing into checkout experiences [5][6] - Regulatory oversight may tighten in response to rising usage and default risks associated with BNPL and embedded credit [6] Alternative Data Utilization - Alternative lenders are increasingly using nontraditional data sources to assess creditworthiness for underbanked segments, including mobile usage and transaction history [7] - Standardization of alternative-data scoring and improved default prediction accuracy are expected, with lenders leveraging proprietary data partnerships to outperform generic models [8] Institutional Capital Inflows - Alternative lending in Africa is attracting institutional capital and private credit lenders seeking higher yields, particularly in fintech-originated credit and SME lending [9] - Partnerships between capital providers and originators are expected to scale credit into various segments, increasing competitive pressure on credit standards and deal transparency [10] Embedded Credit Integration - Alternative credit is being integrated into digital platforms and mobile money ecosystems, which is particularly relevant in markets with strong mobile money usage [11] - The quality of integration and underwriting precision will determine the margin and risk premium on embedded credit [12] Competitive Landscape - The alternative lending landscape in Africa is heterogeneous, with strong incumbents in markets with favorable digital infrastructure, while many participants compete in niche segments [13][14] - Traditional banks still dominate consumer and SME lending, with alternative lenders focusing on underserved segments such as micro loans and embedded credit at point-of-sale [15] Key Players and Market Dynamics - Leading examples include 4G Capital in Kenya, which offers unsecured working capital loans, and Yoco in South Africa, which is expanding its reach among SMEs [21] - New entrants often come from mobile money platforms or fintechs with existing payment relationships, and many alternative lending models are financed through partnerships rather than full acquisitions [21] Regulatory Environment - Regulators in many African countries are beginning to create or update frameworks around fintech lending, focusing on consumer protection and credit risk rules [21] - The forecasted period is expected to see increased regulatory maturity, with more countries defining licensing and supervision for digital lenders [21]

Though it seems like just yesterday that millennials were bopping away to “Get Low” in the club, they’ve now reached an age where retirement is on the horizon. After growing up during periods of broader financial tumult — and having their love of lattes and avocado toast unfairly blamed for it — many millennials may assume that retiring wealthy simply isn’t in the cards. To paraphrase another popular song from their teen years, they’d better lose themselves in the moment of smart retirement planning. Bar ...

Core Insights - Affirm Holdings, Inc. (AFRM) and American Express Company (AXP) operate in different segments of the payments ecosystem, with both companies positioned at the intersection of consumer spending and credit [1] - The evolving payment preferences and financing models are leading investors to compare traditional card-based companies with newer embedded-finance disruptors [2] Affirm's Position - Affirm is a key player in the buy now, pay later (BNPL) model, integrating into digital checkout experiences, and has reported a 33.6% year-over-year revenue growth in its last quarter [4][10] - The company has 24.1 million active consumers and a 96% repeat transaction rate, indicating strong user engagement [4][10] - Affirm's technology-first underwriting model utilizes real-time data and machine learning for credit risk assessment, which has stabilized credit performance [5] - The company has a growing merchant ecosystem with 420,000 partners, including major brands like Shopify and Amazon, enhancing its market presence [6] - Affirm's long-term debt-to-capital ratio stands at 70.6%, higher than AmEx's 64.1%, reflecting its growth-stage profile [7] - The company is diversifying its funding sources through securitizations and bank partnerships, which is expected to improve profitability over time [8] American Express's Position - American Express is recognized as a leading operator in traditional payments, benefiting from a loyal customer base and strong brand equity, with an 11% revenue growth in its latest quarter [9][10] - The company's revenue mix is heavily reliant on lending and interest income, which may limit its agility in adopting new payment technologies [11] - Growth for AmEx is more incremental due to its deep market penetration, making it challenging to achieve outsized growth without increasing credit risk [12] - Innovation at AmEx is characterized as measured rather than disruptive, which may restrict its competitive edge against faster-moving fintech companies [13] Comparative Analysis - The Zacks Consensus Estimate indicates a projected 560% year-over-year earnings surge for Affirm in fiscal 2026, compared to a 15.4% increase for American Express [14][15] - Affirm trades at a higher price-to-sales multiple of 5.58X, reflecting its growth profile, while AmEx's multiple is 3.33X, indicative of its maturity [16] - Over the past month, Affirm has outperformed American Express, with a 14% increase compared to AmEx's 5.8% rise [18] Conclusion - While American Express provides stability and reliable cash flows, Affirm is positioned as the more attractive growth opportunity for 2026, driven by rapid revenue growth and an expanding merchant ecosystem [21]

Summary of Bread Financial Conference Call (December 10, 2025) Company Overview - **Company**: Bread Financial (NYSE: BFH) - **Industry**: Credit Card and Financial Services Key Points Company Strategy and Focus - Bread Financial continues to focus on responsible growth and disciplined risk management, aiming to be a leading provider in the credit card space [1][2] - The company has improved its financial position and is now a capital return story, with solid EPS levels expected moving forward [1] - Operational excellence is emphasized as a key driver for business transformation and investment [3] Consumer Spending and Macroeconomic Environment - Consumer spending has shown resilience, with higher risk bands spending more on travel and entertainment, while lower risk bands focus on non-discretionary items [5] - Inflation has been a concern, but consumers are budgeting well and showing flexibility in spending, particularly during the holiday season [6] - A low single-digit growth of 1%-2% year-over-year in consumer spending is expected for the fourth quarter [8] Loan Growth and Underwriting - Average loans are expected to slightly decrease in 2025, but a return to low to mid-single-digit growth is anticipated for the following year due to improved credit performance and new partnerships [15][17] - The company maintains a cautious underwriting stance, focusing on data-driven decisions rather than a broad loosening of credit standards [23][25] Partnerships and New Business Development - Bread Financial's partner pipeline remains robust, with recent partnerships announced with Bed Bath & Beyond, Furniture First, and Raymour & Flanigan [30] - The company focuses on both acquiring new partners and maintaining existing relationships, with top partners committed until 2028 and beyond [35][54] Credit Performance and Loss Rates - The company has seen improving credit performance, with expectations to come in on the lower end of the 7.8-7.9% loss rate guidance [66] - A further improvement of 30-40 basis points in loss rates is anticipated for the next year, driven by better credit quality and consumer behavior [75][96] Capital Structure and Financial Management - Bread Financial has successfully restructured its capital, achieving a CET1 ratio in the mid-13% to 14% range [139] - The company plans to issue additional preferred shares to further strengthen its capital structure [141] - A focus on returning value to shareholders through dividends and buybacks is maintained, with a strong balance sheet allowing for multiple capital allocation strategies [118][150] Technology and Innovation - The company is leveraging AI and technology to enhance customer service, fraud management, and operational efficiency [128] - Bread Financial is committed to staying competitive by building strong relationships with partners and continuously improving its offerings [130] Market Position and Future Outlook - The company is optimistic about its growth trajectory, with a focus on improving credit quality and expanding its partner base [197] - Bread Financial encourages investors to judge the company based on its consistent outcomes and strong balance sheet, highlighting the potential for future growth [198] Additional Insights - The company has successfully navigated a challenging macroeconomic environment and is positioned for continued improvement in credit quality and operational efficiency [96][197] - Bread Financial's approach to partnerships emphasizes long-term relationships rather than transactional interactions, which is seen as a competitive advantage [135]

Core Insights - Affirm Holdings, Inc. (AFRM) is currently valued significantly higher than its industry peers, with a forward P/E multiple of 54.61X compared to the industry average of 34.17X, raising questions about whether the market is recognizing its growth potential or overvaluing it [1][4][21] - The company has shown a 27.8% increase in free cash flow over the past year, reaching $769 million, but its P/FCF of 30.78X is still above the industry average of 28.26X, indicating strong investor confidence in its growth prospects [2][4] - Analysts maintain a positive sentiment towards Affirm, with an average price target of $94.77, suggesting nearly 38% upside potential despite the high valuation multiples [4][21] Financial Performance - Affirm ended the latest fiscal quarter with $1.4 billion in cash and cash equivalents, a 5.5% increase from fiscal 2025, while its funding debt rose to $1.8 billion, resulting in a long-term debt-to-capital ratio of 70.62%, significantly higher than the industry average of 13.38% [8][21] - The company has achieved an 11.6% stock gain year-to-date, outperforming the industry average of 10.2%, although it still lags behind the broader S&P 500 Index [9][21] Competitive Landscape - Affirm faces intense competition from well-funded rivals like PayPal and Block, which are expanding aggressively into the BNPL space, supported by their established merchant networks [12][21] - A notable setback occurred when Walmart switched from Affirm to Klarna for its installment options, highlighting the rapid competitive innovations in the payments sector [13][21] Growth Potential - Affirm's growth narrative remains strong, with 96% of transactions in the first quarter of fiscal 2026 coming from repeat customers, indicating a solid user engagement strategy [15][21] - The company is expanding into everyday spending categories, with transactions increasing by 52.2% year-over-year to 41.4 million in the latest quarter [16][21] - The Affirm Card has emerged as a significant growth driver, with 500,000 new cardmembers added in the last quarter and GMV rising 135% to $1.4 billion [17][21] - International expansion is underway, with partnerships like Shopify entering new markets such as France, Germany, and the Netherlands, enhancing its network effect with 420,000 merchant partners and 24.1 million active consumers [18][21] Earnings Outlook - The Zacks Consensus Estimate predicts a nearly 567% year-over-year increase in earnings for fiscal 2026, reaching $1 per share, with revenue growth projected at 26% for fiscal 2026 and 22.8% for fiscal 2027 [19][20][21] - Affirm has consistently exceeded earnings estimates in the past four quarters, with an average surprise of 129.3% [20][21]

Core Insights - PayPal's shares declined by 2.6% following the CFO's announcement that branded checkout growth is expected to be a couple of points lower in Q4 2025 compared to the previous quarter [1][9] Company Performance - The company has experienced consistent mid-single-digit growth in branded checkout for several quarters, with a total payment volume (TPV) growth of 8% on a currency-neutral basis in Q3 2025, and online branded checkout rising by 5% [2] - In Q4 2025, PayPal plans to invest one to two points of transaction margin dollars into product attachment and habituation, while higher operating expenses (OpEx) in 2026 are expected to slow growth in transaction margin dollars and earnings per share compared to 2025 [3] - PayPal has observed a decrease in consumer spending and average order value, attributed to macroeconomic uncertainty, although online shopping continues [4] Product Performance - The Buy Now, Pay Later (BNPL) service is growing consistently at 20% quarter-over-quarter, while Pay with Venmo has seen a significant growth of 40% quarter-over-quarter [5][9] Competitive Landscape - Other companies like Block (XYZ) and Mastercard (MA) are also expanding their services and product offerings, with Block focusing on new products across Square and Cash App, and Mastercard diversifying into services such as cybersecurity and data analytics [6][7] Valuation and Estimates - PayPal shares have declined by 28.9% year-to-date, underperforming the broader industry and the S&P 500 Index [8] - The stock is trading at a forward 12-month P/E of 10.50X, significantly lower than the Zacks Financial Transaction Services industry's 20.23X, indicating a cheap valuation [10] - The Zacks Consensus Estimate for full-year 2025 EPS has been revised upward, suggesting a 14.8% year-over-year increase [11]

We recently published 10 Stocks Deep in the Red. Block Inc. (NYSE:XYZ) is one of the worst performers on Tuesday. Block Inc. saw its share prices decline by 6.59 percent on Tuesday to close at $60.11 apiece as investor sentiment was dented by the launch of a probe into six “Buy Now, Pay Later” (BNPL) companies. Afterpay—a subsidiary of Block Inc. (NYSE:XYZ) which engages in BNPL—was one of the six firms that received letters from the offices of the Attorneys General of California, Colorado, Connecticut, ...

Summary of Marqeta 2025 Conference Call Company Overview - **Company**: Marqeta (NasdaqGS:MQ) - **New CEO**: Mike Milotich has been appointed as CEO and CFO, focusing on strategic initiatives and growth [1][3] Key Industry Insights - **Platform Differentiation**: Marqeta operates a full modern platform that supports both credit and debit transactions across over 40 markets, which is a key driver for future growth [4][5] - **Scalability**: The company plans to add approximately $100 billion in volume to its platform, emphasizing the importance of scalability for large enterprises and financial institutions [5] Business Performance - **Buy Now, Pay Later (BNPL)**: - BNPL business saw a 33% growth in total payment volume (TPV) in the last quarter, with lending and BNPL use cases growing over 60% [8][9] - Adoption of Visa's Flexible Credential has significantly improved the value proposition for BNPL services [9][10] - European operations are also growing rapidly, particularly with Klarna migrating millions of cards to Marqeta's platform [12][30] - **On-Demand Delivery**: This segment has seen a resurgence, doubling its growth rate and expanding into new merchant categories and markets [14] - **Gross Profit Growth**: - The company expects gross profit growth to exceed 20% this year, driven by strong performance in BNPL and on-demand delivery [20][21] - International business, particularly in Europe, is growing over 100% in TPV, contributing to overall growth [22] Customer Relationships and Contract Renewals - **Major Customer Updates**: - Two major contract renewals are pending, expected to impact growth by about 2 percentage points each [18][19] - Block, Marqeta's largest customer, is diversifying processors, which may impact gross profit by approximately 200 basis points in 2026 [23][24][26] - **Klarna Partnership**: The Klarna Card has launched in 15 new countries, showcasing Marqeta's ability to support rapid expansion and innovation [30] Operational Efficiency - **Cost Management**: - The company has improved operational efficiency, with adjusted EBITDA expected to exceed $100 million this year, up from $29 million last year [36] - Stock-based compensation is projected to stabilize around $110 million annually, essential for attracting and retaining talent [40] Strategic Acquisitions - **TransactPay Acquisition**: This acquisition enhances Marqeta's ability to serve multinational customers consistently, allowing for seamless processing and program management across regions [42][44] Future Outlook - **Growth Strategy**: Marqeta aims to continue expanding its platform capabilities and customer base, particularly in the embedded finance sector, targeting large multinational companies [45][46] Conclusion - Marqeta is positioned for significant growth through its scalable platform, strong performance in BNPL, and strategic partnerships, while also focusing on operational efficiency and customer retention strategies.

Core Insights - Retail giants Walmart and Amazon are expanding their lending operations in India, targeting small businesses and eCommerce shoppers [2][4] Group 1: Amazon's Initiatives - Amazon plans to offer loans to small business owners in India, having acquired the nonbank lender Axio, which provides BNPL and personal loans [2] - The company aims to design tailored lending propositions to enhance cash flow management for merchants and small businesses [3] Group 2: Walmart's Flipkart Developments - Flipkart, owned by Walmart, is exploring buy now, pay later (BNPL) products and has registered its nonbank lending arm, Flipkart Finance, awaiting regulatory approval [4] - Flipkart plans to offer no-cost monthly installment loans for eCommerce shoppers and loans for consumer durables with interest rates between 18% and 26% per year, expected to launch next year [4]