Recent IPO Affirm Holdings (AFRM) may be the best company that you’ve never heard of after it recently signed deals with Amazon (AMZN), Walmart (WMT), Peloton (PTON) and others. Although it’s still finding its footing in the market, it’s well-positioned and a watchlist candidate. On Friday, Affirm stock’s Relative Strength Rating climbed to a new percentile, rising to 81 from 77 the day before.
The 81 RS Rating means that Affirm stock is outperforming 81% of all stocks in IBD’s database, regardless of industry group. Decades of market research shows that the stocks that go on to make the biggest gains often have an 80 or higher RS Rating as they launch their biggest runs.
Big Money Loading Up On Affirm Stock
Among other key ratings, Affirm stock has a middling 49 Composite Rating, on a 1-99 scale with 99 tops. However, big money investors are loading up on Affirm stock as the buy now, pay later method of paying gains popularity. San Francisco-based Affirm, which launched its IPO in January, has established an early position in that sector. BNPL allows consumers to buy goods and make installment payments, usually with no interest charges or fees. For more on BNPL, see the story in today’s Investor’s Business Daily. As a result of the rising popularity of BNPL, Affirm has a solid B Accumulation/Distribution Rating on an A+ to E scale with A+ the best. The B rating shows big investors are moderately heavily buying shares.
In terms of fundamentals, last quarter the company lost $1, flat with its result a year ago. However, revenue in its most recent quarter jumped 67% to $230.7 million. Revenue the prior three quarters grew 120%, 98% and then 57%.
Affirm stock is not currently near a potential buy zone. See if the stock goes on to form a sound pattern that could launch a new move.
When you’re researching the best stocks to buy and watch, keep a close on eye on relative price strength.
IBD’s proprietary rating identifies market leadership with a 1 (worst) to 99 (best) score. The grade shows how a stock’s price movement over the last 52 weeks holds up against all the other stocks in our database.
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