By Mackenzie Tatananni

Despite a sobering report showing that nearly half of "buy now, pay later" users missed payments last year, Affirm shares were jumping on Wednesday. Thank positive analyst commentary for that.

Citi Research analyst Bryan Keane assigned the stock an Upside 90-Day Catalyst Watch ahead of Affirm's May 12 investor day. Keane expects management to refresh medium-term targets set in 2023, which the company "has since sustainably outperformed."

The analyst specifically expects management to set a medium-term outlook for more than 20% revenue growth and adjust other metrics upward. This includes tightening its revenue less transaction costs margins, a key profitability measure for Affirm's core lending operations, to a range of 3.5% to 4% of gross margin volume. This compares with a previous outlook calling for margins of 3% to 4% of GMV.

Chief Financial Officer Rob O'Hare said on the last earnings call that the company expects RLTC take rates to exceed 4% for both the third and fourth fiscal quarters of 2026.

In Keane's view, the company "has hit a delta change since its 2023 Investor Forum regarding both growth and profitability," and the analyst expects Affirm to update its target framework accordingly. His other calls include GAAP operating margin guidance in the 18% to 20% range and a GAAP tax rate assumption of roughly 20%.

The analyst maintains a Buy rating and $100 price target on the shares.

Citi's bullish call came just days after LendingTree published a report suggesting customers were overly reliant on BNPL loans, a cornerstone of Affirm's business. The online marketplace polled more than 2,000 consumers and found 47% of respondents were late to pay a BNPL loan in the past year, up from 41% at the time of the last survey in 2025, and up from 34% in 2024.

More than half of respondents to the LendingTree survey said they relied on BNPL loans "to make ends meet," while just 25% disagreed with the statement. While users weren't asked to specify what they meant, responses to other questions indicated nearly a third of users were paying for groceries using BNPL loans.

While the report might've given some investors pause, it wasn't taking the wind out of Affirm's sails on Wednesday. The stock climbed 6.7% to extend its steep gains from the previous session, when it closed up 7.4%. The benchmark S&P 500 was rising 0.4%.

Affirm sees itself as more than a BNPL lender, and it's possible that narrative has resonated with investors. While Affirm frequently is characterized as one of the biggest BNPL providers in the U.S., the company has dismissed that as an oversimplification. Chief Operating Officer Michael Linford told Barron's in February that Affirm was, at its core, a software company.

"The fundamental trend here is that consumers are done with revolving credit accounts," Linford said at the time. "The ways in which you can deliver credit outside revolving credit has become this catch-all buy now, pay later, but that's fundamentally different than what we do in our monthly installment program. To lump all that stuff together, I think, is a bit of a shortcut."

Shares of Affirm have cratered 20% this year in the face of rising consumer default rates, a challenging macroeconomic backdrop, and a broader, protracted slump in fintech stocks. The S&P 500 is up 2.2% over the same period.

Write to Mackenzie Tatananni at mackenzie.tatananni@barrons.com

This content was created by Barron's, which is operated by Dow Jones & Co. Barron's is published independently from Dow Jones Newswires and The Wall Street Journal.

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April 15, 2026 12:36 ET (16:36 GMT)

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