Buffett Brain · Research note
Score updated 26 Sept 2026 · analysis from 27 Jul 2026
SEZL· Financial Services
Sezzle
Sezzle's high gross margins of 88.7% are overshadowed by inconsistent profitability and a troubling 5-year average ROIC of -5.5%.
Buffett fit
Partial fit
Owner
50
Durability
62
Management
78
Price
34
Score updated 26 Sept 2026 · analysis from 27 Jul 2026
Buffett's checklist
Each number against Buffett's bar, and where it ranks among Financial Services stocks in our database.
How much profit the business makes on each dollar invested in it. Higher is better.
What is left of each sale after the cost of making the product. A high number often means pricing power.
The cash the business earns for its owners, compared with the price of the whole company.
How fast sales grew each year over the last five years.
How many years of today's profit you pay for at today's price. Lower means cheaper.
How much the company owes compared with what it owns outright. Lower is safer.
The four pillars
How the business measures up on each of Buffett's four tests.
If I owned 100% of Sezzle, I'd focus on stabilizing profitability, as the current net income of $133.13M is not sufficient to ensure long-term growth.
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The 10-year test shows that Sezzle has not been profitable over the last five years, which is concerning.
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Sezzle's share count has grown at 1.75% annually, which is not overly dilutive, but the yield of 0.46% indicates a lack of aggressive capital return strategies.
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The current yield of 5.21% falls short of the ideal 8-10% threshold.
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- The full reasoning behind all four pillars
- The 5-year price target and the return it implies
- What would change the call
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For and against
The strongest points on each side, with the numbers behind them.
In its favor
5- 1 of 88.75% is well above the sector top-quintile cutoff of 81.9%.
- 2 of 46.74% is in the top quintile for the Financial Services sector, indicating strong returns on invested capital.
- 3Current ratio of 3.65 shows excellent liquidity, well above the typical threshold.
- 4Interest coverage ratio of 24.2 demonstrates strong ability to service debt.
Concerns
5- 15-year average of -5.5% raises doubts about long-term capital efficiency.
- 2The lack of profitability over the last five years (not profitable in at least one year) is a significant red flag.
- 3 of 40.74% is below the sector top-quintile cutoff of 58.3%.
- 4 of 27.1 suggests the stock is priced for growth that may not materialize.
Price history
$136+17,034.6%· 5-year return
Weekly closing prices. Touch or hover the line for a date.
The business
How the business works
Sezzle operates as a payment solution provider, allowing customers to split purchases into four interest-free payments. With $450.28M in TTM revenue, the business model relies on consumer spending and merchant partnerships. The high of 88.75% indicates strong , but the lack of consistent profitability raises questions about long-term sustainability.
How this analysis has moved
The call has held across 5 reviews.
Sep 27, 2026 → Oct 22, 2026
What other investors would say
The same company, judged by three other documented playbooks.
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