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Research Alert: CFRA Keeps Hold Rating On Shares Of Klarna Group Plc

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CFRA, an independent research provider, has providedwith the following research alert. Analysts at CFRA have summarized their opinion as follows:

After digesting Q1 results, we raise our target by $2 to $18, 14.7x our 2028 EPS estimate, a discount to its historical trading average (36.1x) but more aligned with peers (14.3x). We increase our 2026 EPS view to $0.16 from -$0.14, keep 2027's at $0.68, and increase 2028's to $1.23 from $1.15. KLAR shares surged after the company reported a strong Q1, highlighted by accelerated growth and a pivotal return to net income profitability. This performance was fueled by the rapid scaling of its Fair Financing product and the increasing adoption of the Klarna Card, which expanded its merchant and user networks. Management signaled strong confidence by reiterating its full-year 2026 guidance, underscoring its strategy to become a default payment provider while leveraging its deposit-funded model. Despite the positive results, we think key risks remain, including rising transaction costs due to the shift to higher-cost products and the inherent credit risk associated with the rapid expansion of its loan book.

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