Affirm Holdings Stock (AFRM) has traded sideways in recent days, and the upcoming earnings report could be a trend-breaking event for this stock. The bull case remained solid, while a confirmation from the fundamental perspective could grab massive investors' attention.
AFRM Bulls Await For the Earnings Report
Investors and market analysts are avidly anticipating the earnings report of Affirm Holdings, which is scheduled for February 8, 2024. Estimates indicate that the company will disclose an Earnings Per Share (EPS) of $0.07, representing a 106.36% growth from the prior year.
Furthermore, the aggregate projection expects earnings of $518.42 million, an increase of 29.75% compared to last year's corresponding period.
Any recent adjustments to analyst forecasts regarding Affirm Holdings are of equivalent significance. Frequently, these revisions reflect the most recent transient business dynamics, which evolve rapidly. A positive trajectory in estimations could potentially indicate an optimistic outlook on the organization's future performance.
AFRM Key Metrics
Affirm Holdings is valued at a Forward P/E ratio of 122.13, greater than the industry average of 15.85. It is a sign that Affirm Holdings might be valued higher than the industry average, which could be a barrier to bulls.
In addition, the PEG ratio is at 8.37, which indicates the earnings growth rate with its P/E ratio. In contrast, the average PEG ratio for the industry was 1.42 as of the previous close and the higher PEG ratio for the company suggests a potential increase in earnings.
The recent ratio of 1:7.08 suggests a stable position in operating the day-to-day business, while the net profit margin has not been positive since 2020.
Affirm Stock (AFRM) Technical Analysis
In the daily chart of AFRM stock price, a corrective price action is visible as the recent price trades within a descending channel after a bullish impulse. In this market structure, the ideal approach is to look for long trades once the minor downside correction is over.
In the higher timeframe, a bull run is potent as the Affirm stock price forms a solid bottom at the 8.48 level, from where a recent counter-bullish impulsive wave appeared. The latest monthly candle closed bearish but remained as an inside bar to the previous bullish candle. The weekly price also suggests an upward continuation as the recent candle is corrective after setting a top at the 52.47 level.
Based on this outlook, a valid bottom formation with a descending channel breakout could be a strong bullish opportunity in this instrument. In that case, the 52.47 level would be a major barrier before reaching the 83.71 high.
On the bearish side, the ongoing downside pressure below the 20-day EMA could reach the 34.18 Fibonacci Retracement level before showing a bullish reversal.
