Jim Cramer Remains A Believer In Affirm Holdings (NASDAQ:AFRM)

Jim Cramer remains optimistic about Affirm Holdings (NASDAQ:AFRM), despite the stock's recent decline. Cramer praised Affirm, Max Levchin's company, during a September 3rd morning appearance on CNBC, stating that it is the best among fintech firms. Affirm's fiscal fourth quarter earnings report on August 27th led to Cramer's enthusiastic endorsement, with the stock rallying 10% and the CEO acknowledging the company's impressive growth.

However, after the earnings release, Affirm's shares declined by more than 12%. Cramer's reaction to the drop was unsurprising, given his strong belief in the company. Affirm's key metrics, such as gross merchandise volume (GMV) growth, active customer growth, and revenue less transaction costs (RLTC) growth, were positive in Q4.

The company's GMV increased by 36% and its fiscal year 2027 RLTC as a percentage of GMV was 4.16%, which was higher than the surrounding years. Affirm also reported that 30% of its Affirm Card transactions now occur offline, signifying its diversification beyond traditional eCommerce. Block Inc. (NYSE:XYZ) has been performing well, with its stock up by over 7% over the past year.

Metrics to watch for Block include CashApp growth, loan losses, Bitcoin growth, and Square growth. CashApp's gross profits grew by 31% in the fiscal second quarter, while Square's gross profit increased by 13%. However, Block's Bitcoin gross profit decreased by 31% and transaction and loan losses surged by 99%. Hedge fund sentiment towards Affirm and Block is also different, with 57 funds holding AFRM and 76 holding Block in Q2. Valuation-wise, AFRM's forward P/E ratio is higher (37.31) than Block's (15.53).