Affirm Holdings, Inc. AFRM recently partnered with JD Sports, a retailer of sports, fashion and outdoor brands. This collaboration aims to provide customers of JD Sports and Finish Line with pay-over-time options while purchasing products from top brands like adidas, New Balance, Nike and North Face.

The move comes ahead of Black Friday and Cyber Monday and customers are expected to benefit from Affirm’s buy now, pay later (BNPL) solutions’ flexibility and transparency. This collaboration brings Affirm’s customizable payment options to more than 500 JD Sports and Finish Line stores across the country and online platforms.

Shoppers can choose a payment plan with rates as low as 0% APR, offering no hidden or late fees. The partnership comes at an opportune time, perfectly timed for the holiday rush, as AFRM witnessed a 50% hike in purchases at sporting goods retailers in October 2024 from the year-ago level. This signals a growing demand for sports fashion and footwear.

The collaboration integrates JD Sports into Affirm's extensive network of more than 320,000 merchants, including Amazon, Peloton, American Airlines, SeatGeek and others. This strategic partnership is likely to enhance JD Sports’ sales and average order value. The deal is also expected to contribute to an increase in Affirm's merchandise volume.

As inflation drove up costs, more consumers turned to BNPL solutions for financial flexibility. With interest rates expected to normalize in the future, lower borrowing costs could further boost transactions and increase usage of Affirm’s services.

Price Performance

Over the past year, shares of Affirm have surged 125.6% compared with the 32.1% growth of the industry it belongs to.

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Zacks Rank & Other Key Picks

Affirm currently has a Zacks Rank #2 (Buy).

Some other top-ranked stocks in the broader Business Services space are Coinbase Global, Inc. COIN, Cantaloupe, Inc. CTLP and DLocalLimited DLO, each carrying a Zacks Rank #2 at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

The Zacks Consensus Estimate for Coinbase’s current-year earnings of $5.22 per share indicates a massive jump from the year-ago level of 37 cents. COIN beat earnings estimates in three of the trailing four quarters and met once, with the average surprise being 341.4%. The consensus estimate for current-year revenues is pegged at $5.6 billion, an 80.6% year-over-year growth.

The Zacks Consensus Estimate for Cantaloupe’s current-year earnings indicates a 113.3% year-over-year surge. CTLP beat earnings estimates in two of the trailing four quarters, met once and missed on the other occasion, with the average surprise being 20%. The consensus estimate for current-year revenues implies 15.9% year-over-year growth.

The consensus estimate for DLocal’s current-year earnings is pegged at 47 cents per share, which witnessed three upward revisions in the past month against none in the opposite direction. It beat earnings estimates in two of the trailing four quarters and missed twice, with the average surprise being 22.6%. The consensus estimate for DLO’s current-year revenues is pegged at $745 million, implying 14.6% year-over-year growth.

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