Sezzle (SEZL), a provider of in-store and online payments services, says its Chairman and CEO Charlie Youakim has pledged more than 1.72 million shares for a $10 million margin loan.

Youakim owns approximately 44.2% of Sezzle’s shares.

The shares pledged are approximately 69.2% of Youakim’s shares and 30.4% of Sezzle’s shares outstanding.

Separately, Sezzle’s delinquencies on late payment fees spiked $4.22 million in 2024 or 240.4% year-over-year (YoY).

This compares to the previous YoY increase of 52.9% (2023-2022).

Overall, Sezzle’s bad debt allowance increased to 13.6% of receivables in 2024, up from 8.5% in 2023.

Investors might be wise to monitor Sezzle’s customer credit quality given the company’s borrowing rate of 11.25%.

With an Enterprise Value (EV) of approximately $1.57 billion, Sezzle is priced as if it will grow annual sales to more than $4.5 billion, up from an estimated $353.5 million in 2025. To justify its current share price of $261.06 our Reverse DCF— which quantifies investor expectations embedded in the current share price— indicates Sezzle must:

—Grow sales 35% annually between 2027-2034, faster than the company’s estimated 2025 and 2026 sales growth of 30.4% and 16.2%, respectively
—Increase NOPAT margin to 17%, significantly higher than our 3-year average estimate of 9.02%, though less than less than our 2024 estimate of 39.3%
—Increase Invested Capital (IC) Turns to 2.1, up from our 2024 estimate of 1.9

Notably, the current share price also implies Sezzle maintain a Return on Invested Capital (ROIC) of 35.7% versus our 2024 estimate of 74.08% and 3-year average estimate of (131.5%):