Benzinga - by Anusuya Lahiri, Benzinga Editor.
Worldline's warning of a "macroeconomic deterioration" in core geographies like Germany hurts the entire FinTech sector pre-market, Mizuho analyst Dan Dolev noted.
Key stocks like Affirm Holdings, Inc (NASDAQ: AFRM) (Buy rating, price target $24), Block, Inc (NYSE: SQ), and PayPal Holdings, Inc (NASDAQ: PYPL) (Buy rating, price target $92) are each trading down.
Dolev views the worries as overblown as Visa Inc (NYSE: V) (Neutral rating, price target $240) specifically did not call out a recession in its initial FY24 guide, which it provided yesterday.
Plus, when asked about Europe, Visa's CEO mentioned "resiliency" and feeling "good about what's happening" in the EU ex. UK.
As per Dolev, stocks like AFRM and SQ have little to no exposure to Germany & Europe, which means the adverse stock reactions are unmerited.
Dolev noted Affirm trading ahead of the peer group is appropriate given AFRM's position as the market leader in BNPL and continues to improve on adjusted profitability prospects.
Mastercard Inc (NYSE: MA) (Buy rating, price target $435) trades at a slight premium to peer V as MA has less exposure to debit (which faces more medium-term challenges than credit) and less reliance on the U.S., where card penetration is much higher than in many international markets.
Given recent challenges, PayPal trades to V & MA at a discount.
Price Action: AFRM shares traded higher by 5.83% at $17.61 on the last check Thursday.
Latest Ratings for AFRM
| Feb 2022 | Barclays | Maintains | Overweight | |
| Feb 2022 | Credit Suisse | Maintains | Neutral | |
| Feb 2022 | Jefferies | Downgrades | Hold | Underperform |
View the Latest Analyst Ratings
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