Affirm Falls 21% Due to Tweet

Will Affirm hit profitability?

Steven Lerner 11.Feb.2022

Today is Friday, February 11, 2022.

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Affirm Falls 21% Due to Tweet

Shares of Affirm (Nasdaq: AFRM) fell 21.42% on Thursday during trading hours and dropped another 7.29% in after-hours trading after the fintech company posted bad earnings.

Financials: Affirm reported a 57-cent loss per share. The company also reported revenue of $361 million, which was better than expected.

Bad Guidance: It was the guidance that really stung Affirm. The company projects revenue in the upcoming quarter between $325 million to $335 million, and adjusted operating loss as a percentage of revenue between 19% to 21%. Investors had higher expectations.

Bad Tweet: The company’s official Twitter account inadvertently tweeted the financial results during trading hours - long before the earnings call, which caused a massive slide in the stock price.

Background: Affirm is a “buy now, pay later" company, which gives customers short-term loans to buy items. The stock is down 64% in the past three months.

The Good: The number of active consumers grew by 150% in the quarter.

Final Thoughts: When will Affirm finally achieve profitability? Can its partnership with Amazon (Nasdaq: AMZN) help grow the business?

Notables

Notable Earnings Today: Cleveland-Cliffs (NYSE: CLF), Under Armour (NYSE: UAA), Goodyear Tire & Rubber (Nasdaq: GT), Enbridge (NYSE: ENB), Magna International (NYSEL MGA), Apollo Global Management (NYSE: APO), Byrna Technologies (Nasdaq: BYRN), Newell Brands (Nasdaq: NWL), Alliancebernstein (NYSE: AB), Dominion Energy (NYSE: D), American Axle & Manufacturing (NYSE: AXL), Ares Management (NYSE: ARES), Fortis (NYSE: FTS), Green Plains (Nasdaq: GPRE), W. P. Carey (NYSE: WPC).

Notable IPOs Today: Modiv Inc. (NYSE: MDV), RiverNorth Managed Duration Municipal Income Fund II, Inc. (Nasdaq: RMMZ), CEA Industries Inc. Common Stock (Nasdaq: CEAD), A SPAC I Acquisition Corp. Unit (Nasdaq: ASCAU), Jaguar Global Growth Corporation I Unit (Nasdaq: JGGCU), Direct Digital Holdings, Inc. Class A Common Stock (Nasdaq: DRCT), Arogo Capital Acquisition Corp. Class A Common Stock (Nasdaq: AOGO), Relativity Acquisition Corp. Unit (Nasdaq: RACYU), TC BioPharm (Holdings) plc American Depositary Shares (Nasdaq:n TCBP), Signal Hill Acquisition Corp. Unit (Nasdaq: SGHLU), Gaming Technologies, Inc. Common Stock (Nasdaq: GMGT).

Notable Equity Crowdfunding Campaigns Ending Today: Speakeasy Donuts (MainVest), Wicked BOLD (MainVest), Chewy’s Bagels (MainVest), Brakes To Go (StartEngine), I & I Rose Garden (MainVest), Recombinant Technologies (StartEngine).

Notable Economic Events Today: Fed Monetary Policy Report (10:00 a.m. ET), Michigan Consumer Expectations (10:00 a.m. ET), Michigan Consumer Sentiment (10:00 a.m. ET).

Zillow’s Home Segment Propels Earnings

Shares of Zillow (Nasdaq: Z) jumped 17.03% in after-hours trading on Thursday after the real estate marketplace posted positive earnings

Financials: Revenue hit $3.9 billion in the quarter, which was better than expected.

Go Home: The quarter included $3.3 billion of revenue in its home segment, exceeding the company’s outlook as the wind-down of the iBuying segment progressed at a faster rate.

Final Thoughts: In the past year, Zillow’s stock has been down 74%. This might be an opportunity to buy in at the right price.

What Should Investors Do In February 2022?

Following a turbulent start to the year, what should investors plan to do in February?

Diversify: If there was ever a time to focus on diversification, this is it. Some of the stocks that did well last year are now tanking, including big technology names. It is time to have a portfolio with stocks in all of the major sectors.

Expect Less: It is also time to readjust your expectations. 2022 may not be a year of record growth, but achieving a modest return could still happen.

Final Thoughts: February could also be a good month to buy the dip on stocks that tanked in January.