Affirm vs Bread Financial Which Is More Reliable?

Affirm and Bread Financial are two prominent players in the growing financial technology sector, offering innovative solutions for consumer lending and payment plans. Affirm, founded by entrepreneur Max Levchin, is known for its transparent and flexible financing options, while Bread Financial, recently acquired by Alliance Data Systems, provides point-of-sale financing solutions for retailers. Both companies have experienced significant growth in recent years, attracting attention from investors and consumers alike. Let's compare and analyze the stock performance of Affirm and Bread Financial to determine their potential for future success.

Affirm or Bread Financial?

When comparing Affirm and Bread Financial, different investors may prioritize various metrics based on their investment strategies and goals. So, ask yourself what type of investor you are. This will guide you in determining which metrics are most important for your investment decision between Affirm and Bread Financial.

Dividend Investors:

Dividend investors look for stable and growing income streams, using dividend metrics to assess potential investments. A company's dividend yield essentially measures the size of its dividend relative to the total market value of the company. Affirm has a dividend yield of -%, while Bread Financial has a dividend yield of 1.76%. Beyond the yield itself, considering the growth and sustainability of these dividends is also crucial. Affirm reports a 5-year dividend growth of 0.00% year and a payout ratio of 0.00%. On the other hand, Bread Financial reports a 5-year dividend growth of -18.10% year and a payout ratio of 13.46%.

Value Investors:

Value investors focus on financial metrics to determine a stock's intrinsic value compared to its market value. The Price-to-Earnings (P/E) Ratio links stock price to a company's earnings per share, with Affirm P/E ratio at -40.52 and Bread Financial's P/E ratio at 9.49. Another crucial valuation metric is the Price-to-Book (P/B) Ratio, which compares stock price with book value per share. Affirm P/B ratio is 6.38 while Bread Financial's P/B ratio is 0.95.

Growth Investors:

Growth investors prioritize metrics indicative of a company's expansion potential. Focusing on top-line growth, Affirm has seen a 5-year revenue growth of 4.24%, while Bread Financial's is -0.16%. Return on Equity (ROE) measures how effectively a company uses equity investment to generate earnings, with Affirm's ROE at -16.49% and Bread Financial's ROE at 10.20%.

Retail Investors:

Retail investors often consider stock affordability and company familiarity. For example, day low prices are $47.98 for Affirm and $59.34 for Bread Financial. Over the past year, Affirm's prices ranged from $21.88 to $57.76, with a yearly change of 163.99%. Bread Financial's prices fluctuated between $26.27 and $63.01, with a yearly change of 139.86%. Brand recognition also plays a role, as familiarity with a company can influence investment decisions.