Financials & FinTech research, Galliano’s Financials Research

Victor Galliano

Financials & FinTech research

Financials & FinTech, EM & Developed Markets

Galliano’s Financials Research

Galliano's Financials Research provides fundamental research in Emerging Markets financials, including FinTech, as well as financials in select Developed Markets.

The investment style applied is generally value oriented, although Growth At Reasonable Price (GARP) strategies can also be used where appropriate. 

Our investment research approach aim is often contrarian, looking to capitalise on overly sceptical or optimistic consensus views. In terms of valuation techniques, the focus is on PBV ratio to ROE, PE multiples and dividend yield, as well as the application of PEG ratios and, where appropriate, Sum of the Parts (SOTP) valuations.

Equity Bottom-Up

<ul>
<li>In the current volatile investment climate, we rein in our buy ratings retaining just one name despite the continuing attractive valuation metrics</li>
<li>We remove attractively valued PagBank and recent IPO PayPay from our payments buy list, due to a more volatile, potentially “risk-off”, investment climate</li>
<li>We keep only Klarna on the buy list, due management’s solid execution and attractive valuations, but we advise reducing positions</li>
</ul>


In the current volatile investment climate, we rein in our buy ratings retaining just one name despite the continuing attractive valuation metrics
We remove attractively valued PagBank and recent IPO PayPay from our payments buy list, due to a more volatile, potentially “risk-off”, investment climate
We keep only Klarna on the buy list, due management’s solid execution and attractive valuations, but we advise reducing positions


Payment Companies Update: Reining in Positive Recommendations

<ul>
<li>On the back of the “risk on” phase, we remove the sell rating on Affirm shares, and after their recent period of underperformance</li>
<li>We keep our buy rating on Klarna, primarily for its deep value credentials but also for its current high level of short interest</li>
<li>Block (XYZ US) is not a pure BNPL play, but is increasingly exposed to the sector through its acquisition of Afterpay; we maintain our neutral rating on Block</li>
</ul>


On the back of the “risk on” phase, we remove the sell rating on Affirm shares, and after their recent period of underperformance
We keep our buy rating on Klarna, primarily for its deep value credentials but also for its current high level of short interest
Block (XYZ US) is not a pure BNPL play, but is increasingly exposed to the sector through its acquisition of Afterpay; we maintain our neutral rating on Block


BNPL Companies; Risk on Phase, Stick with Buy on Klarna (KLAR US), Lifting Short on Affirm (AFRM US)

Covering IPOs, Healthcare and Technology Stocks

Andrei Zakharov

<ul>
<li>Klarna Group had a successful IPO in September, but shares were volatile in October and November along with Affirm Holdings and other BNPL market players.</li>
<li>A Swedish first mover in the BNPL space went public at $40.00 per share, raising ~$169M of net proceeds. Selling shareholders offloaded ~$1.2B worth of Klarna Group shares.  </li>
<li>Klarna Group reported record results in 3Q as a public company, surpassing analyst expectations. However, net loss widened to $95M and provisions for credit losses jumped.</li>
</ul>


Klarna Group had a successful IPO in September, but shares were volatile in October and November along with Affirm Holdings and other BNPL market players.
A Swedish first mover in the BNPL space went public at $40.00 per share, raising ~$169M of net proceeds. Selling shareholders offloaded ~$1.2B worth of Klarna Group shares.  
Klarna Group reported record results in 3Q as a public company, surpassing analyst expectations. However, net loss widened to $95M and provisions for credit losses jumped.


Klarna Group (NYSE: KLAR): 3Q’25 Quarterly Update, 4Q Guidance Trajectory Looks Strong

Asian Hedge Fund Manager, Long Short Equity, Macro

David Mudd

Cross Asset Strategy

<ul>
<li>The US government will begin refunding some of the $166 billion in tariffs collected illegally since Liberation Day last year.  The refunds will go mostly to large corporate importers.</li>
<li>
The tariff policy, which the President is intent on restarting, did not help industrial manufacturing employment or reduce the trade deficit.  Inflation is much higher than when Trump took office.</li>
<li>The BNPL industry is reflecting the strains on the US consumer.  Delinquencies are rising, and the average transaction price is declining as users begin using BNPL for everyday purchases.</li>
</ul>


The US government will begin refunding some of the $166 billion in tariffs collected illegally since Liberation Day last year.  The refunds will go mostly to large corporate importers.

The tariff policy, which the President is intent on restarting, did not help industrial manufacturing employment or reduce the trade deficit.  Inflation is much higher than when Trump took office.
The BNPL industry is reflecting the strains on the US consumer.  Delinquencies are rising, and the average transaction price is declining as users begin using BNPL for everyday purchases.


CHARTING COURSE: Tariffs; Here Today, Gone Tomorrow and BNPL Feeding Subprime Consumers

US-EU Index Rebalances / Quantitative Researcher, ORTEX

Dimitris Ioannidis

US-EU Index Rebalances / Quantitative Researcher

Global Financial Data and Analytics Platform

ORTEX

ORTEX is a global financial data and analytics platform providing real-time securities lending and short interest data, index rebalance data, holdings and insider transactions, trading signals, corporate actions and news,  stock machine learning and factor scores and other analytics. The majority of the data are downloadable and accessible through APIs.

Index Rebalance

<ul>
<li>
<a href="https://www.smartkarma.com/entities/klarna-group-plc" target="_blank" data-smartkarma-citation="entities:44090:1" rel="noopener">Klarna Group (KLAR US)</a> is ineligible for US indices due to incorporation and headquarters in the UK, a foreign listing in the US and a majority of assets in Sweden.</li>
<li>
<a href="https://www.smartkarma.com/entities/klarna-group-plc" target="_blank" data-smartkarma-citation="entities:44090:1" rel="noopener">Klarna Group (KLAR US)</a> is ineligible for EU indices due to a sole listing in the US.</li>
<li>
<a href="https://www.smartkarma.com/entities/klarna-group-plc" target="_blank" data-smartkarma-citation="entities:44090:1" rel="noopener">Klarna Group (KLAR US)</a> can achieve inclusion in Global indices given an eligible nationality and following the lock-up expiry which increases float cap and public voting rights.</li>
</ul>



Klarna Group (KLAR US) is ineligible for US indices due to incorporation and headquarters in the UK, a foreign listing in the US and a majority of assets in Sweden.

Klarna Group (KLAR US) is ineligible for EU indices due to a sole listing in the US.

Klarna Group (KLAR US) can achieve inclusion in Global indices given an eligible nationality and following the lock-up expiry which increases float cap and public voting rights.


Klarna (KLAR US): US-EU Index Exclusion Remains; Slim Prospects for Global Index Inclusion

United States

Klarna is a Swedish fintech company that provides online financial services. The company provides payment processing services for the e-commerce industry.

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Klarna Group (KLAR US)

Payment Companies Update: Reining in Positive Recommendations

In the present volatile investment climate, only Klarna remains on our buy list due to solid execution and attractive valuations; our caution...

Victor Galliano

BNPL Companies; Risk on Phase, Stick with Buy on Klarna (KLAR US), Lifting Short on Affirm (AFRM US)

A switch to "risk on" in markets and the stock's recent de-rating drives our closing out of Affirm's sell; we keep Klarna on a buy rating for deep...

Victor Galliano

Klarna Group (NYSE: KLAR): 3Q’25 Quarterly Update, 4Q Guidance Trajectory Looks Strong

Klarna Group shares continue to trade below IPO offer price of $40.00 per share. The Swedish BNPL giant reported record results in 3Q as a public...

Andrei Zakharov

CHARTING COURSE: Tariffs; Here Today, Gone Tomorrow and BNPL Feeding Subprime Consumers

The US government will begin refunding some of the $166 billion in tariffs that were illegally collected since Liberation Day last year. The...

David Mudd

Klarna (KLAR US): US-EU Index Exclusion Remains; Slim Prospects for Global Index Inclusion

KLAR faces index exclusion in US and EU due to a US foreign listing and UK headquarters. Global index inclusion is possible in September 2026...

Dimitris Ioannidis

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52-week Range

Market Cap (USDm)

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Payment Companies Update: Reining in Positive Recommendations

​In the present volatile investment climate, only Klarna remains on our buy list due to solid execution and attractive valuations; our caution...

Victor Galliano

BNPL Companies; Risk on Phase, Stick with Buy on Klarna (KLAR US), Lifting Short on Affirm (AFRM US)

A switch to "risk on" in markets and the stock's recent de-rating drives our​ closing out of Affirm's sell; we keep Klarna on a buy rating for deep...

Victor Galliano

Klarna Group (NYSE: KLAR): 3Q’25 Quarterly Update, 4Q Guidance Trajectory Looks Strong

​Klarna Group shares continue to trade below IPO offer price of $40.00 per share. The Swedish BNPL giant reported record results in 3Q as a public...

Andrei Zakharov

CHARTING COURSE: Tariffs; Here Today, Gone Tomorrow and BNPL Feeding Subprime Consumers

The US government will begin refunding some of the $166 billion in tariffs that were illegally collected since Liberation Day last year. The...

David Mudd

Klarna (KLAR US): US-EU Index Exclusion Remains; Slim Prospects for Global Index Inclusion

​KLAR faces index exclusion in US and EU due to a US foreign listing and UK headquarters. Global index inclusion is possible in September 2026...

Dimitris Ioannidis

In the present volatile investment climate, only Klarna remains on our buy list due to solid execution and attractive valuations; our caution...

A switch to "risk on" in markets and the stock's recent de-rating drives our closing out of Affirm's sell; we keep Klarna on a buy rating for deep...

Klarna Group shares continue to trade below IPO offer price of $40.00 per share. The Swedish BNPL giant reported record results in 3Q as a public...

KLAR faces index exclusion in US and EU due to a US foreign listing and UK headquarters. Global index inclusion is possible in September 2026...