Affirm Holdings, Inc. (NASDAQ: AFRM) has been a focal point for institutional investors, with notable adjustments in holdings during the fourth quarter. Jones Financial Companies Lllp reduced its stake in Affirm by 39.0%, selling 875 shares and retaining 1,368 shares valued at $83,000. The shift comes as several hedge funds and asset management firms made strategic investments in the stock.
Institutional Interest in Affirm Gains Momentum
A number of hedge funds have significantly increased their positions in Affirm, signaling confidence in its long-term potential:
- Holocene Advisors LP initiated a new position worth $27.87 million in Q3.
- Charles Schwab Investment Management Inc. boosted its stake by 44%, now holding 2.2 million shares worth $89.94 million.
- Bank of Montreal Can increased its holdings by 269.7%, acquiring 528,400 shares, bringing its total position to 724,336 shares valued at $29.81 million.
- Atreides Management LP initiated a new position worth $20.40 million.
- Quadrature Capital Ltd more than tripled its stake, increasing by 214.4%, with 485,431 shares worth $19.82 million.
Collectively, institutional investors now own 69.29% of Affirm’s stock, highlighting the growing institutional confidence in its business model.
Insider Selling Activity
Company insiders have been active in trading Affirm’s stock:
- Director Keith Rabois sold 16,086 shares on January 2nd at an average price of $62.32, reducing his holdings by 14.65%.
- Director Christa S. Quarles sold 5,000 shares on February 14th at an average price of $80.00, trimming her position by 3.51%.
- In the last quarter, insiders collectively sold 59,801 shares valued at $3.8 million.
Insiders currently own 12.41% of the company’s stock, which remains a notable aspect for investors tracking internal sentiment.
Affirm Stock Performance and Key Metrics
Affirm’s stock has been on an upward trajectory:
- Current Price: $50.08 (up 6.8% on Monday)
- 52-Week Range: $22.25 – $82.53
- Market Cap: $15.93 billion
- P/E Ratio: -77.05 (indicative of continued growth investment)
- Beta: 3.63 (showing high volatility)
- Debt-to-Equity Ratio: 2.68
- Quick & Current Ratio: 11.26 (indicating strong liquidity)
Earnings Beat and Analyst Sentiment
Affirm’s Q4 earnings results, released on February 6th, surpassed expectations:
- Earnings Per Share (EPS): $0.23 vs. analyst estimate of ($0.21) (a beat of $0.44)
- Return on Equity (ROE): -7.25%
- Net Margin: -7.10%
Wall Street analysts remain moderately bullish:
- The Goldman Sachs Group raised its price target from $78 to $90, maintaining a “buy” rating.
- Mizuho increased its target from $65 to $69, rating it “outperform”.
- Barclays boosted its price target from $75 to $85, maintaining an “overweight” rating.
- Citizens Jmp upgraded Affirm to “strong-buy”.
- Nine analysts rate it “hold”, ten analysts rate it “buy”, and one analyst gives it a “strong buy”.
- Consensus Price Target: $70.24
Conclusion
The latest shifts in institutional ownership, robust earnings performance, and positive analyst sentiment indicate growing confidence in Affirm’s long-term trajectory. With increasing adoption of Buy Now, Pay Later (BNPL) solutions and strategic expansion initiatives, Affirm remains a key player in the fintech space. Investors should continue monitoring institutional activity and insider trading for further insights into the stock’s future direction.
