Rich Peter
Investor, Crypto, US Stocks & High-Dividend ETFs
Affirm is a bottom-fishing opportunity now that it has turned from years of losses to consistent profitability. Q2 fiscal 2026 EPS of $0.37 beat estimates, revenue rose 29.6% and GMV 36.6%, and trailing net income turned positive. Its Amazon partnership runs through 2031, Lowe's has joined, and BNPL demand should rebound as rates improve. At about 35x forward earnings and a PEG of 0.72, the stock is reasonably valued or even undervalued for its growth. x.comÂ
Affirm's free cash flow is exploding, making its 19x forward free-cash-flow valuation look seriously undervalued. Free cash flow is projected to reach $1.4 billion this fiscal year. The $100 target by early 2027 remains, and Affirm fits the preference for businesses that can compound intrinsic value regardless of what happens to the volatile AI trade. x.comÂ
Affirm Holdings has a catalyst in its May 12 Investor Forum, where management is expected to set a medium-term framework covering UK expansion, rent and B2B verticals and the Affirm Card. Card GMV is up 159% with 3.7 million active holders, and Affirm is reportedly pursuing a banking license. Its Amazon partnership runs through 2031, and it landed Costco and a Stripe AI Shopping Token integration in the same week. The weekly chart is curling; the view holds while it confirms above 52.90. x.comÂ
Affirm looks a bit expensive here, with fair value around $70 to $80, even though buy now, pay later should keep taking share from traditional credit cards. BNPL limits borrowing to when it is needed and cuts off borrowers who do not repay, lowering risk for both user and lender, unlike credit cards with large limits. Affirm is growing over 35%, and its balance account pays over 3% interest through a linked debit card that can also use BNPL. x.comÂ
Amazon is a cash cow trading at a lean multiple, while CEO Andy Jassy says AWS is booming. x.comÂ
Amazon offers one of the best risk-reward setups in the Magnificent 7 as it becomes one of the world's biggest AI, cloud and advertising companies. AWS Q2 revenue rose 37% to $42.2B, its fastest growth in 18 quarters, with a 39% operating margin and a $496B backlog. AI chips and services top a $25B run rate, advertising grew 26% to $19.8B, and e-commerce margins are expanding. At 20x trailing earnings it looks very cheap; consensus targets sit near $330, and $500 is the longer-term setup. x.comÂ
Affirm's claim of a resilient consumer rings hollow because its model offers little visibility into credit risk. Like mortgage underwriters before the housing collapse, it originates and sells the loans, so it bears little risk itself. BNPL is opaque, with payments not reported to credit agencies; a survey found 41% of buyers made late BNPL payments over 12 months, against a reported 1.2% 30-day delinquency rate. Fitch assumes a 4% default rate because it is not given pool delinquency data. … Show more
Shopify's 34% growth and 15% FCF margin give it an elite Rule of 40 score of 49, so the market will forgive its GAAP loss. That loss came from a $1.1B write-down on its stakes in Affirm, Global-e and Klaviyo, market volatility rather than business failure. Merchant Solutions grew 39% versus 21% for subscriptions, showing Shopify is really a fintech company, and Bloomberg flows show smart money buying the dip at $108. x.com x.com x.com x.comÂ
Affirm and Klarna can take a large share of the credit card market as consumers turn away from predatory cards. Credit cards are over $15 trillion, and buy now, pay later should capture at least 20% of that within 10 years. x.comÂ
Amazon's post-earnings dip is a buying opportunity because the Street wrongly believes its capex is too high, and the stock has since whipsawed back to all-time highs. x.com x.comÂ
Amazon remains a very cheap stock at 10.7x 2026 EV/EBITDA, given 12% long-term revenue growth and 15% long-term EPS growth. x.comÂ
