Affirm Holdings, Inc. AFRM recently announced that it expanded its partnership with Adyen, making it the first Buy Now, Pay Later (BNPL) provider to integrate with Adyen for Platforms. This collaboration allows Affirm’s payment solutions to be used by platform businesses like marketplaces and on-demand services.

Additionally, Affirm is now offering its monthly installment plans to Adyen merchants in Canada, enhancing its payment options beyond the existing biweekly plans. This move aims to provide greater consumer flexibility while helping merchants increase sales and reach new customers.

This should drive higher transaction volumes, especially given the significant growth the partnership has already experienced, with annual volume increasing more than 7X from 2021 to 2023. The added flexibility of monthly installment plans could further attract more users and boost overall usage. AFRM is offering tailored payment plans ranging from six weeks to three years, featuring as low as 0% APR and no late or hidden fees.

The market opportunity highlighted in the partnership is substantial. According to research by Adyen and Boston Consulting Group, the market for platforms embedding payments and financial services is estimated at $185 billion. This extended partnership positions both Affirm and Adyen to tap into this growing sector, offering flexible payment solutions to different emerging financial services platforms.

AffiniPay, an Adyen partner specializing in practice management software and integrated payment solutions for professionals, has processed more than $125 million through Pay Later. This legal fee financing solution, available through the LawPay payments software, is powered by AFRM.

AFRM’s Price Performance

Over the past year, shares of Affirm have jumped 31.4% compared with the 21.9% growth of the industry it belongs to.

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Zacks Rank & Key Picks

Affirm currently has a Zacks Rank #3 (Hold).

Some better-ranked stocks in the broader Business Services space are Coinbase Global, Inc. COIN, Cantaloupe, Inc. CTLP and DLocalLimited DLO. While Coinbase currently sports a Zacks Rank #1 (Strong Buy), Cantaloupe and DLocal carry a Zacks Rank #2 (Buy) each. You can see the complete list of today’s Zacks #1 Rank stocks here.

The Zacks Consensus Estimate for Coinbase’s current-year earnings of $5.39 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 $5.7 billion, implying 83.9% 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 15.8% 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 60 days 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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