Needham initiated coverage of Affirm (AFRM) with a Hold rating. Needham rates the stock at Hold however due to a combination of valuation at 32-times its expected FY26 EPS, elevated stock-based compensation expense at 46% of last-12-months revenue, and a growing mix share of interest and other lending-related income that may make significant multiple expansion challenging, the firm tells investors in a research note.

Needham initiated coverage of SoFi Technologies (SOFI) with a Buy rating and $10 price target. The company is seen as a long-term winner in the digital lending/neobank space, largely due to its focus on prime and super-prime consumers and possession of a full banking license, which provides it superior unit economics compared to other consumer finance platforms that focus on lower income borrowers and/or lack a banking license, firm says.

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