Subscription-Based Offerings to Drive the Rally for Sezzle (SEZL)

Sezzle Inc. (NASDAQ:SEZL) is one of the best financial pure plays under $100 according to hedge funds.

On December 23, Northland Securities analyst Michael Grondahl reaffirmed his bullish view on Sezzle Inc. (NASDAQ:SEZL). Although he reduced his price target from $130 to $110, Grondahl still anticipates over 69% upside for the stock.

Grondahl held discussions with Sezzle’s (NASDAQ:SEZL) management, who plan to pivot back towards subscription-based offerings such as Anywhere and Premium. This strategic shift offers a more stable revenue base in the long run compared with On-Demand offerings. It also leads to superior yields, better customer engagement, and enhanced customer lifetime value.

The analyst noted that the company will continue offering on-demand products to price-sensitive and lower-credit users. Such a mix will ensure a significant improvement in the company’s risk profiling and underwriting discipline. The analyst also acknowledged Sezzle’s (NASDAQ:SEZL) data-driven methodical approach that facilitates decision-making based on weighted lifetime value for different products and segments.

The broader analyst coverage does indicate an optimistic view of Sezzle Inc. (NASDAQ:SEZL). As of December 30 closing, the estimated 1-year average price target for the stock stands at $101, which leads to more than 55% upside potential. The stock received three analyst ratings, of which 2 were Buys, and 1 was Hold.

Sezzle Inc. (NASDAQ:SEZL) is a financial technology company that operates a “buy now pay later platform.” It allows consumers to make purchases with flexible payment terms involving one upfront payment followed by four interest-free installments. These payments are spread over a six-week period, which boosts the consumer’s purchasing power.

While we acknowledge the potential of SEZL as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you’re looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock.

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Disclosure: None. This article is originally published at Insider Monkey.