Affirm vs Sezzle Which Is a Smarter Choice?

Affirm and Sezzle are two fintech companies at the forefront of the buy now, pay later trend in the financial sector. Affirm, founded by PayPal co-founder Max Levchin, is a well-established player in the industry with a strong brand presence and wide merchant network. Sezzle, on the other hand, is a newer entrant gaining traction with its interest-free installment payment options. Both companies have seen significant growth in recent years, making them popular choices for investors looking to capitalize on the booming BNPL market.

Affirm or Sezzle?

When comparing Affirm and Sezzle, 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 Sezzle.

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 Sezzle has a dividend yield of -%. 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, Sezzle reports a 5-year dividend growth of 0.00% year and a payout ratio of 0.00%.

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 -50.42 and Sezzle's P/E ratio at 30.55. 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 7.93 while Sezzle's P/B ratio is 28.03.

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 Sezzle's is 3096.77%. Return on Equity (ROE) measures how effectively a company uses equity investment to generate earnings, with Affirm's ROE at -16.49% and Sezzle's ROE at 137.51%.

Retail Investors:

Retail investors often consider stock affordability and company familiarity. For example, day low prices are $67.78 for Affirm and $308.02 for Sezzle. Over the past year, Affirm's prices ranged from $22.25 to $72.82, with a yearly change of 227.28%. Sezzle's prices fluctuated between $13.30 and $477.52, with a yearly change of 3490.41%. Brand recognition also plays a role, as familiarity with a company can influence investment decisions.