Affirm Holdings (AFRM) has several avenues to keep its growth story afloat despite shares losing value since November amid macro headwinds, Morgan Stanley said in a late Monday research report.

Despite concerns about credit performance due to macroeconomic volatility, data shows delinquencies remain low on an "absolute basis" and it is unlikely for the company to undergo a significant reserve build in the short term, according to the note.

Analysts said they see Affirm having sufficient leverage within operating expenses to minimize the impact of a recent Walmart (WMT) announcement, as the retail company will likely embrace a data-driven approach to volume allocation between One and Affirm.

The Shop Pay Instalments launch is expected to help the company maintain strong growth at Shopify (SHOP), and gradual expansion could drive upward fiscal 2026 estimates revisions, the brokerage stated.

Accelerating app feature development and 0% offers in the quarter are expected to lure and retain users with higher incomes over time, Morgan Stanley said.

The brokerage said it retained its equalweight rating on the stock and cut its price target to $60 per share from $65.

Price: 51.31, Change: -0.79, Percent Change: -1.51