Is SEZL a good stock to buy? We came across a bullish thesis on Sezzle Inc. on The Atomic Moat’s Substack by Rob H. | Atomic Moat. In this article, we will summarize the bulls’ thesis on SEZL. Sezzle Inc.’s share was trading at $73.47 as of March 6th. SEZL’s trailing and forward P/E were 19.75 and 15.75, respectively according to Yahoo Finance.
Copyright: prykhodov / 123RF Stock Photo
Sezzle Inc. (SEZL) operates in the buy-now-pay-later (BNPL) sector, offering consumers the ability to split purchases into interest-free installments while generating revenue through merchant fees, subscriptions, and consumer charges. The company’s core product allows shoppers to pay 25% upfront and settle the remaining balance over several weeks, providing short-term financing while merchants benefit from higher conversion rates.
Read More: 15 AI Stocks That Are Quietly Making Investors Rich
Read More: Undervalued AI Stock Poised For Massive Gains
Beyond transactions, Sezzle has expanded its ecosystem with products such as Sezzle Premium subscriptions and Sezzle Anywhere, creating multiple revenue streams that include merchant fees, subscription income, and late payment charges. In the third quarter of 2025, the company reported $116.8 million in revenue on $1.05 billion of gross merchandise volume, marking its first billion-dollar quarterly sales milestone. The platform also reached nearly 3 million active consumers and about 0.6 million active subscribers, indicating strong engagement and growing recurring revenue potential.
Despite these strong operating metrics, the stock has fallen sharply from about $182 in mid-2025 to roughly $69, reflecting a significant multiple compression as investors reassessed risks associated with lending and credit exposure. The company remains profitable, generating $26.7 million in net income during the quarter and approximately $90.4 million over the first nine months of 2025, with adjusted EBITDA margins near 34%.
However, the market’s caution stems from rising marketing spending and higher credit provisions as management broadened underwriting standards to accelerate growth. Credit loss provisions reached 3.1% of GMV, above management’s long-term target of 2.5%–2.75%. If credit performance normalizes while Sezzle maintains its 11.2% take rate and continues expanding its subscriber base, the current valuation of roughly 19x earnings could represent an attractive entry point, suggesting meaningful upside if profitability and credit discipline remain intact.
Previously, we covered a bullish thesis on Sezzle Inc. (SEZL) by Next’s Substack in May 2025, which highlighted the company’s rapid revenue growth, strong profitability with 34% net margins, and founder-led management with significant insider ownership. SEZL’s stock price has depreciated by approximately 18.45% since our coverage due to reassessed risks associated with lending and credit exposure. Rob H. | Atomic Moat shares a similar view but emphasizes credit risk dynamics and valuation compression.
Sezzle Inc. is not on our list of the 40 Most Popular Stocks Among Hedge Funds. As per our database, 23 hedge fund portfolios held SEZL at the end of the fourth quarter which was 22 in the previous quarter. While we acknowledge the risk and potential of SEZL as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than SEZL and that has 10,000% upside potential, check out our report about this cheapest AI stock.
Disclosure: None.
