Affirm Is Down 50%, and It Might Get Worse

The emerging financial technology of "buy now, pay later" (BNPL) has attracted investor attention for its popularity with young shoppers who spend an increasing amount of money online. The recent IPO of BNPL fintech company Affirm (NASDAQ: AFRM) was met with some initial excitement, but since the spirited opening rally, the stock has fallen over 50% from its all-time high.

There are some lessons to be learned from a country like Australia, a global hub for this specific offering that is now saturated with BNPL hopefuls. It's becoming increasingly evident that most of these companies will struggle to ever make money, and they face competitive headwinds from giants like PayPal entering the race. Put simply, BNPL is a technology with almost no barriers to entry and very little proprietary value.

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Source Fool.com