Affirm Holdings continued its decline in Thursday pre-market trading after broker BTIG initiated coverage on the company with a sell rating and $10 price target.
After sinking 9.1% on Wednesday, shares of the San Francisco-headquartered technology company were 2.5% down at $16.61 ahead of the market open.
According to reports, the analysts noted that the business model of Affirm, a buy-now-pay-later operator, is under pressure due to tighter discretionary spending as the macroeconomic environment deteriorates and as rising interest rates affect the cost of funding.
“Our biggest concern is the pace at which expenses are outpacing revenue growth,” the BTIG analysts wrote in a note to clients.
Affirm Holdings Inc offers a platform for digital and mobile-first commerce. It comprises a point-of-sale payment solution for consumers, merchant commerce solutions, and a consumer-focused app. The firm generates its revenue from merchant networks, and virtual card networks among others. It generates a major share of its revenue from the US.
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