Jim Cramer is Talking About These 12 Stocks

7. Affirm Holdings, Inc. (NASDAQ:AFRM)

Number of Hedge Fund Holders: 34

Affirm Holdings, Inc. (NASDAQ:AFRM) operates a payment network that spans the United States, Canada, and beyond. The company provides a comprehensive platform that includes point-of-sale payment solutions for consumers, merchant commerce solutions, and a user-friendly app tailored for consumers. Cramer called the stock “real good” and said that it is “going higher.” Over the last 12 months, the stock is up by over 90%.

In a rapidly evolving industry, the company is positioning itself as a player in the competitive buy now, pay later (BNPL) sector, competing with other firms such as Klarna Bank AB. Max Levchin, the founder and CEO, has commented that the company is outpacing its competitors in this crowded market, noting a significant demand for its services.

In June, Affirm Holdings (NASDAQ:AFRM) announced that its BNPL loans would be integrated with Apple Pay, and as of September 16, eligible users could utilize this feature when checking out online or in-app on iPhones and iPads.

The integration allows Apple Pay users in the U.S. to request flexible payment options, splitting purchases into biweekly or monthly installments with attractive terms, including options for as low as 0% APR. This collaboration improves the user experience as it combines the convenience and security of Apple Pay with the company’s focus on transparency and no hidden fees.

In September, Mizuho Securities assigned the stock an Outperform rating with a price target set at $65. The analysts pointed to favorable conditions for the company, especially following the Federal Reserve’s decision to reduce interest rates by 50 basis points.

The firm sees this development as beneficial for the company for two key reasons: lower rates improve revenue less transaction costs and is likely to attract new customers or encourage existing users to take on additional debt.

Furthermore, the analysts predict that the reduction in rates could lead to a substantial increase, estimated between 30% to 35%, in gross merchandise volume for fiscal 2027. This, combined with the company’s operating leverage, could potentially result in earnings per share that double or even triple current consensus forecasts, according to the analysts.