5 big analyst cuts: Affirm slashed to Underweight as higher rates pressure margins

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Affirm (NASDAQ:AFRM) shares fell more than 5% premarket today after Piper Sandler downgraded the company to Underweight from Neutral with a price target of $11.00.

The company relies heavily on loan sales for revenue, but higher rates and wider credit spreads have led them to hold more loans on their balance sheet, which also pressures operating margins.

Furthermore, stricter underwriting standards, increased pricing, and the reintroduction of student debt payments are expected to slow down revenue growth. As a result, Piper Sandler believes it will be challenging for the company to achieve the Street estimate of 24% revenue growth for 2024. According to Piper Sandler, revenue growth has decelerated to 11% and 7% in the past two quarters.

American Express (NYSE:AXP) shares fell more than 1% premarket today after Baird downgraded the company to Neutral from Outperform with a price target of $185.00, as reported in real time on InvestingPro.

The company is set to report its Q2/23 earrings on July 21. Street estimates stand at $2.84 for EPS and $15.4 billion for revenues.

Jefferies downgraded Conagra Foods (NYSE:CAG) to Hold from Buy and cut its price target to $38.00 from $46.00.

JPMorgan downgraded Eagle Materials (NYSE:EXP) to Underweight from Neutral with a price target of $190.00 (from $155.00).

Piper Sandler downgraded HubSpot (NYSE:HUBS) to Neutral from Overweight with a price target of $520.00 (from $482.00).

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