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Affirm (AFRM) Partners With Hotels.com to Expand Payment Options

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Affirm Holdings, Inc. (AFRM - Free Report) recently partnered with Hotels.com, which is owned by travel technology company Expedia Group, Inc. (EXPE - Free Report) . The move expands AFRM’s existing partnership with Expedia Group, which already offers Affirm’s buy now, pay later (BNPL) solutions on its platforms like Expedia and Vrbo.

This collaboration aims to provide Hotels.com guests with options to book accommodations and pay over time by dividing the total cost of their purchase into manageable payments. Given the strong recovery witnessed in travel and entertainment space in the post-pandemic period, this partnership is expected to address a growing demand. The deal is expected to contribute to an increase in Affirm's merchandise volume.

The collaboration integrates Hotels.com into Affirm's extensive network of 292,000 retail partners, which includes Amazon, SeatGeek, Royal Caribbean, Great Wolf Lodge and others. This strategic partnership is poised to enhance Hotels.com's sales and average order value. It is also expected to bring in new customers on its website.

This move is anticipated to enhance the customer experience by offering transparent terms without hidden or late fees. AFRM’s partnership with Hotels.com follows last week’s collaboration with auto repair technology company Tekmetric. Approved Tekmetric customers now can select the BNPL option in both online and in person auto repair services.

While consumer reliance on BNPL solutions and similar services increased during high inflation, future normalization of rates will reduce borrowing costs, potentially driving further growth in transactions and AFRM's service usage.

Price Performance

Over the past year, shares of Affirm have surged 99.3% compared with the 8.6% growth of the industry it belongs to.

Zacks Investment Research
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Zacks Rank & Key Picks

Affirm currently has a Zacks Rank #3 (Hold).

Some better-ranked stocks in the broader Business Services space are Paysign, Inc. (PAYS - Free Report) and Remitly Global, Inc. (RELY - Free Report) , each carrying a Zacks Rank #2 (Buy) at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

The Zacks Consensus Estimate for Paysign’s current-year bottom line indicates 75% year-over-year growth. The consensus estimate for PAYS’ current-year top line is pegged at $58 million, suggesting 22.6% year-over-year growth.

The Zacks Consensus Estimate for Remitly Global’s current-year earnings indicates a 53.9% year-over-year improvement. RELY beat earnings estimates in two of the trailing four quarters and missed twice, with an average surprise of 8%. The consensus estimate for current-year revenues suggests 31.8% year-over-year growth.

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