Latest news with #DanDolev
Yahoo
12 hours ago
- Business
- Yahoo
Visa Stock Scores Upgrade. The Move From Cash to Credit Isn't Over.
Mizuho analyst Dan Dolev says plenty of U.S. consumers have yet to make the switch to paying with cards. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
CNBC
3 days ago
- Business
- CNBC
Circle's business model is silly, says Mizuho's Dan Dolev
Dan Dolev, Mizuho senior financial technology analyst, joins 'Power Lunch' to discuss Circle's performance post-IPO.
Yahoo
5 days ago
- Business
- Yahoo
Wall Street Analysts Are Bullish on This Artificial Intelligence (AI) Stock -- Here's What You Need to Know
Some Wall Street analysts see Upstart rising by 50% or more. The company's results have improved since it released an updated AI model. Upstart is making progress in the large auto and home loan makrets. 10 stocks we like better than Upstart › When investors think of AI stocks, Upstart (NASDAQ: UPST) may not be the first that comes to mind. However, the company has a strong claim to the title. It's harnessed the power of machine learning and data science for a new credit platform that has been more accurate at assessing creditworthiness than conventional FICO scores, according to Upstart. As a stock, Upstart has been one of the more volatile names in the market as the business has considerable potential, but it has also struggled to turn a profit in recent years. Plus, any credit business is inherently risky, since loans could go bad if the economy sours, or Upstart's credit partners could stop buying its loans, eliminating the funding it needs to operate. Upstart's latest earnings report offered more reasons to be optimistic. Its transaction volume jumped 102% in the first quarter to 240,706 with originations up 89% to $2.1 billion. Meanwhile, its conversion rate improved from 14% to 19.1% because of an update in its AI model that makes as many as 1 million predictions per applicant to determine whether to lend to the applicant and what interest rate to charge. Overall, revenue jumped 67% to $213 million, and its adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) improved from a loss of $20.3 million to a profit of $42.6 million. Now, several Wall Street analysts have turned bullish on Wall Street, and some see considerable upside to the stock. According to Tipranks, of the 11 analysts that have rated Upstart in the last three months, four analysts rate it a buy and seven call it a hold. However, the average price target for the stock is $65.33, or a 39% upside on average. Among the analysts that are most bullish on Upstart are Peter Christiansen of Citi, who rates the stock a buy and gives it a price target of $83; Dan Dolev of Mizuho, who gives it a buy rating and a price target of $83; and Kyle Peterson of Needham, who gives it a buy rating and a price target of $70. Christiansen has noted Upstart's increasing interest from private credit managers and improving partner network. Dan Dolev recently reiterated a buy rating after double upgrading the stock last year in response to the company's improved profitability, and it's capturing the benefits from AI in its updated model. Kyle Peterson of Needham also sees an improving funding backdrop and balance sheet at Upstart driving the stock higher. Wall Street forecasts on their own aren't a good reason to buy the stock, but they can alert you to good buys. Upstart has its share of naysayers as well. Nearly 25% of the stock is sold short, and Goldman Sachs gave it a sell rating in February with a price target of $15. However, Upstart's business is improving in multiple ways. In addition to the preceding numbers, the company is increasingly tapping into the auto and home loan markets, which represent the biggest addressable markets in front of it. In the first quarter, auto originations grew five times over the last year to $61 million, while home loans grew six times to $41 million. That still represents a small fraction of the company's business, but there is potential for it to get much larger. Upstart's business model is also scalable. The tech platform fully automates more than 90% of loan applications and can therefore scale up to make more loans at a relatively low marginal cost. Operating expenses grew by just 11% in the first quarter even as fee-based revenue was up 34%. Overall, Upstart's technology appears to give it a competitive advantage, and it's seeing momentum in customer demand and funding partnerships. If its momentum continues, its profit should rapidly improve. With a long runway of growth, Upstart looks like a good buy. Before you buy stock in Upstart, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the for investors to buy now… and Upstart wasn't one of them. The 10 stocks that made the cut could produce monster returns in the coming years. Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you'd have $651,049!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you'd have $828,224!* Now, it's worth noting Stock Advisor's total average return is 979% — a market-crushing outperformance compared to 171% for the S&P 500. Don't miss out on the latest top 10 list, available when you join . See the 10 stocks » *Stock Advisor returns as of June 2, 2025 Jeremy Bowman has positions in Upstart. The Motley Fool has positions in and recommends Upstart. The Motley Fool has a disclosure policy. Wall Street Analysts Are Bullish on This Artificial Intelligence (AI) Stock -- Here's What You Need to Know was originally published by The Motley Fool
Yahoo
30-05-2025
- Business
- Yahoo
The Chime IPO: what investors should know about its $31 a share private market valuation and more
Times have changed for Chime, the once hot fintech that was valued at $25 billion in 2021. That year, the IPO market was sizzling when more than 1,000 companies went public on U.S. exchanges. Chime was widely expected to be one of those companies, but it chose to wait. Four years later, Chime's valuation appears to have fallen by more than half, while the IPO market is trying to rebound with some big names, like crypto provider Circle, looking to list. New issues have turned in some strong performances during the past month. The public offerings of online broker eToro Group, Hinge Health and MNTN, the connected TV advertising platform, each rose during their respective debuts and, more importantly, all three have remained above their IPO prices. One of the biggest tests for IPOs will come next week when Circle, the issuer of the crypto stablecoin USDC, begins trading on June 5. Circle could raise as much as $624 million at a roughly $6.7 billion valuation. The Circle IPO is multiple times oversubscribed, Bloomberg reported. Against this positive background, Chime is expected to launch its roadshow soon. It will then give more information on its pending IPO, including how many shares it will sell and at what price. The fintech will trade on the Nasdaq under the ticker CHYM. Founded in 2012, Chime offers traditional financial services, like fee-free checking and savings accounts, to lower income U.S. consumers that earn up to $100,000 a year. The startup had 8.6 million active members as of March 31, with two-thirds relying on Chime as their primary bank, according to a regulatory filing. Roughly 70% of its members use Chime to buy food, groceries, gas and utilities. As of March 31, the startup employed 1,465 workers, or 'Chimers,' spread across three offices, including one-third in San Francisco. Chime is not a bank and doesn't have a bank charter. Instead, it partners with Bancorp Bank and Stride Bank to provide its services. 'Chime definitely has a great brand for that particular cohort, the under banked,' said Dan Dolev, a senior analyst in fintech equity research at Mizuho Securities. 'They've done a great job getting the name out there.' Perhaps the biggest question hanging over Chime is its valuation. Chime has collected $2.3 billion in funding from investors, including General Atlantic, Tiger Global Management, and Sequoia Capital. In 2021, the last time Chime raised money, its shares were valued at $69.07 but that has fallen. Pricing data from Forge, an online marketplace for buying and selling shares of private firms, marked Chime at $31.50 as of May 26. Chime shares have actively traded in the private markets this year and the $31.50 is based on recent trading activity, Forge said. On Hiive, a private stock marketplace, the last accepted bid for Chime was $31 in early March, a spokesman said. There are also standing bids for Chime shares at $40 but no sellers, the spokesman said. This likely indicates that sellers are waiting for prices to move higher. Some believe it is misleading to value a company based on secondary market prices. The secondary market is considered less transparent than the public market, it is more loosely regulated and sales often involve small volumes of stocks, which may not accurately represent a company's true value. Either way, a $31 or $31.50 price for Chime indicates a drop in value of more than 50%. Chime has yet to disclose how many shares it has outstanding so the fintech's total valuation is unclear. 'Like many companies, Chime likely could have gotten a higher valuation had it gone public at the peak of the last cycle in 2021,' said Matt Kennedy, senior IPO strategist at Renaissance Capital, a provider of pre-IPO research that manages two IPO-focused ETFs (NYSE: IPO, IPOS). Chime declined to comment. The field of companies that offer services to lower income consumers has grown more crowded. Green Dot, which has targeted this segment since 2001, is currently up for sale. (Chris Britt, Chime's cofounder and CEO, previously worked at both Green Dot and Visa.) One of Chime's bigger rivals is Cash App, which targets the same group of low-income consumers. Revenue for Cash App in 2024 rose 11% to $16.2 billion, with most, about $10.1 billion, coming from Bitcoin trading. Block, formerly known as Square, owns Cash App. 'Cash App is so established that it makes it difficult to compete,' Dolev said. Mizuho's Dolev says Cash App, which has a debit card, has a more diversified revenue stream than Chime which relies on unregulated interchange—a term that describes debit card fees not subject to a federal cap. Dolev estimates that Chime makes about 1% of every dollar spent in debit card transactions on a net basis, while large banks are capped at 21 cents per transaction. For example, if a consumer uses a Chime debit card to buy $50 worth of groceries at the supermarket, the fintech makes about 50 is the first US-based neobank to go public via a traditional IPO, Renaissance Capital's Kennedy said. (Nu Holdings, of Brazil, went public in 2021 but targets Latin America.) Other neobanks waiting to launch their IPOs include Klarna, which is known more for its buy now, pay later, or BNPL, services. Klarna is reportedly delayed until late in 2025. Revolut, the London fintech, is a licensed bank in the EU and is widely anticipated to go public but has yet to set a date. Chime is unprofitable on a yearly basis with losses narrowing to $25.3 million in fiscal 2024. The company was profitable in the first quarter, reporting nearly $13 million in net income, compared to nearly $16 million in profit for the same quarter in 2024. (But it reported nearly $20 million in losses for the three months ended Dec. 31.) Revenue for Chime rose 31% to about $1.7 billion for fiscal 2024 and grew on a quarterly basis, by 32%, to $518.7 million for the three months ended March 31. A majority of its revenue comes from interchange. 'I think we would have liked to see more progress on the bottom line, the net income side, but I don't see any huge red flags,' Renaissance's Kennedy said. This story was originally featured on Sign in to access your portfolio
Yahoo
15-05-2025
- Business
- Yahoo
Robinhood surges nearly 10% on WonderFi deal; Mizuho sees Canada growth potential
-- Robinhood (NASDAQ:HOOD) is making its first major move into Canada with the acquisition of Wonderfi Technologies Inc (TSX:WNDR), a digital asset firm that operates two of the country's longest-standing regulated crypto platforms. Shares of WonderFi jumped 35% on the news, while Robinhood rose 9.8%. Mogo Inc (TSX:MOGO), WonderFi's largest shareholder, surged nearly 77%. The all-cash deal, announced Tuesday, values WonderFi at C$250 million ($178 million) and provides a 41% premium to its last closing price on the Toronto Stock Exchange. Robinhood will pay C$0.36 per share and expects the transaction to close in the second half of 2025, subject to regulatory and shareholder approvals. While the deal brings crypto platforms Bitbuy and Coinsquare under Robinhood Crypto, analysts are focused on the broader opportunity. According to Mizuho Securities analyst Dan Dolev, the transaction marks 'a critical first step' toward unlocking what he estimates to be a $250 million annual revenue opportunity, equivalent to nearly 10% upside to Robinhood's 2024 revenue. Dolev forecasts that Robinhood could eventually reach about 3 million funded accounts in Canada. 'Assuming revenue per funded account of $75 per year, this implies ~$250 million of annual revenue from Canadian funded accounts,' he wrote. His model discounts Robinhood's U.S. penetration and average revenue per user to arrive at more conservative Canadian estimates. The acquisition also provides strategic benefits beyond user growth. Dolev noted that WonderFi brings with it an Investment Dealer license in Canada, expands crypto staking capabilities, adds 61 supported coins, and complements Robinhood's pending acquisition of Bitstamp in its effort to build institutional crypto offerings. For Robinhood, the deal aligns with its goal of building 'a global financial ecosystem,' SVP Johan Kerbrat said in the press release. 'WonderFi has built a formidable family of brands serving beginner and advanced crypto users alike, making them an ideal partner to accelerate Robinhood's mission in Canada.' WonderFi will continue to operate its brands post-acquisition, and its existing leadership will join Robinhood Crypto. Toronto will remain Robinhood's Canadian headquarters, with more than 140 employees. Mogo, which orchestrated a 2023 merger between Coinsquare and WonderFi, endorsed the deal as a value-maximizing exit. 'This is a defining moment for WonderFi,' said Mogo President Greg Feller. As regulatory filings and shareholder votes move forward, analysts see Robinhood's Canadian strategy as taking shape, starting with crypto and potentially expanding to traditional brokerage services. Related articles Robinhood surges nearly 10% on WonderFi deal; Mizuho sees Canada growth potential Trump's Middle East trip a boon for NVIDIA Peloton raised to Outperform at Macquarie following Q3 earnings
