CE 100 Index Sheds 1.1% as Affirm, Sezzle Losses Offset FIS Sizzle

The CE 100 Index lost 1.1% in a shortened holiday week, with payments-focused names declining.

Only two segments gained ground through the four trading sessions that ended Friday, as the Shop vertical was up 1.5%. And in that segment, Vroom shares rallied 23.6%, though no company-specific headlines or events crossed the wires. The Move segment gained a bit less than 1%.

BNPL Names Lead to the Downside

But it was the Pay and Be Paid segment, which lost 2.4%, that blunted those gains.

Affirm led to the downside here, sliding just under 11%. Piper Sandler downgraded the name to underweight and assigned an $11 price target. As we’ve noted elsewhere in these digital pages, the ratings cut came amid discussion of the business model, depending in part on selling loans. Analysts have also sounded a cautionary note about the competitive pressures that may lie within the buy now, pay later space through new entrants, including Apple.

And later in the week, we reported, Affirm said it was sunsetting Returnly and transitioning the merchants using that platform to Loop.

Returnly was acquired by Affirm two years ago and offers shoppers a self-service online returns experience — and will be closed by early October, Affirm announced. Loop was named as the preferred returns provider for merchants who are using the platform, according to Affirm. The two companies will work together to transition the merchants to Loop.

Affirm had invested in Returnly two years earlier, in 2019, because of its technology that helped merchants “remove friction from returns, drive loyalty and retain more customers,” Affirm CEO Max Levchin said at the time.

Sezzle slipped 10% through the week, having announced a subscription-based service that lets shoppers use its Virtual Card anywhere Visa is accepted.

These losses were enough to offset the 8.5% surge in FIS.

As noted here, FIS is selling its majority stake in Worldpay, its merchant services business, to private equity group GTCR for $18.5 billion. The news came after reports that GTCR and Advent International, a buyouts firm, were vying to pick up a majority stake in Worldpay.

“This transaction allows FIS to partially monetize our Merchant Solutions business at an attractive valuation and provides certainty for all stakeholders,” FIS CEO and President Stephanie Ferris said in a news release. Under the terms of the deal, Worldpay will become a privately held entity, as FIS retains a 45% stake. PYMNTS wrote in February that FIS had begun exploring a tax-free spinoff of its merchant operations after a strategic review. The latest corporate news follows the June report that FIS had purchased embedded finance startup Bond Financial Technologies — a move that, as we detailed, offers the company additional banking-as-a-service (BaaS) and embedded finance talent while also broadening its solutions for FinTechs.

Separately, C3.ai shares gained 7.7% — though the Enablers group, which houses that name, gave up 1.1%.