JPMorgan Sees Klarna Undervalued vs. Affirm ahead of Q2 Report
Swedish fintech company Klarna, which listed in New York last year, has seen its shares climb nearly 70 percent since an April low, but JPMorgan argues the stock still trades at too steep a discount to US rival Affirm, according to EFN.
Klarna’s stock debuted at 40 dollars before slumping to around 12 dollars within six months. It has since recovered to about 20 dollars, helped by positive news including a partnership with Apple that lets customers upgrade devices through a leasing scheme in the Klarna app. JPMorgan called the deal attractive for Klarna’s brand value.
The bank also cited Klarna’s US expansion, which brings longer, more profitable loans, potentially supporting annual revenue growth above 15 percent and margin expansion of roughly 15 percentage points by 2028.
JPMorgan forecasts second-quarter revenue of 992 million dollars, up 21 percent year-on-year, and gross merchandise value of 36.255 billion dollars, near the top of Klarna’s own guidance range, which it called conservative.
Of 25 analysts covering Klarna, 15 rate it buy and 10 hold, with an average price target of 23.27 dollars. Klarna reports second-quarter earnings on Tuesday, August 18.
