Affirm Holdings Inc (NASDAQ:AFRM) stock is up 5.9% to trade at $63.82 at last glance, after Morgan Stanley named it a top pick. The brokerage firm praised the fintech leader's upside potential, and noted that easing concerns around private credit could boost shares.
AFRM is now on track for a fifth-straight gain, as well as its best weekly performance since August 2024. The stock is also trading at its highest level since February and pacing for its first close above the 100-day moving average since January. Longer term, AFRM sports a 50.1% year-over-year lead, though it carries a 14.9% deficit for 2026.
A short squeeze could create additional tailwinds for AFRM. Short interest is up 4.9% in the most recent reporting period, and the 17.10 million shares sold short now make up 6.1% of the equity's available float.
Puts have been more popular than usual in the options pits. This is per the stock's 10-day put/call volume ratio of 1.38 at the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX) that sits higher than 82% of annual readings. This means an unwinding of bearish sentiment could send shares higher.
That shift in sentiment appears to be underway. Drilling down to today's options activity, 24,000 calls have already crossed the tape, compared to a meager 4,050 puts. The most active is the April 67.50-strike call, where new positions are being bought to open. These contracts will expire after today's close.
