Why Shares of Affirm, Upstart, SoFi, and LendingClub Are Getting Hammered This Week
It has not been a good week if you are a fintech investor, with the sector getting beaten bloody on the discovery of the new omicron coronavirus variant, and on worries over a higher and longer-term inflationary environment.
Shares of buy now, pay later company Affirm (NASDAQ: AFRM) traded roughly 23% lower this week as of 2:47 p.m. ET today. Shares of the artificial intelligence loan originator Upstart Holdings (NASDAQ: UPST) traded nearly 19% lower, shares of the one-stop-shop financial services company SoFi Technologies (NASDAQ: SOFI) traded more than 19% lower, and shares of the digital marketplace bank LendingClub (NYSE: LC) traded nearly 20% lower.
The discovery of the omicron variant has hurt the broader market but seemed to really hammer fintech stocks in particular. These companies are in the business of making loans, which can be very tied to the economy. Obviously, if there were the need for further lockdowns, that could erode the credit quality of the borrowers on these loans and could dry up demand in what was supposed to have been a promising economy in 2022.
Source Fool.com
