Chime Stock (CHYM) Surges 70% in Market Debut

Financial technology start-up Chime saw its stock open 70% higher when the shares began trading on the Nasdaq (NDAQ) stock exchange in New York on June 12.

Chime had priced its initial public offering (IPO) at $27 per share, which was above the expected range. The stock opened at $43, which is 70% above the IPO price and values the company at $15.70 billion. Chime said that it raised $700 million from the IPO, with another $165 million of shares sold by pre-IPO investors. The stock trades on the Nasdaq under the ticker symbol “CHYM.”

Chime is the latest in a series of companies to IPO in recent weeks. Online trading platform eToro (ETOR) and crypto stablecoin issuer Circle (CRCL) each recently held successful IPOs. The market debut of Chime comes despite a recent cut to its valuation of $25 billion.

Litmus Test

Wall Street analysts say that Chime’s IPO will serve as a litmus test of investor appetite for consumer-facing finance companies and new stock issuance in general. Chime’s core business is providing no-fee banking services, debit cards, and early paycheck access.

The company gets most of its revenue from interchange fees and competes against other fintech companies such as PayPal (PYPL) and SoFi Technologies (SOFI). Chime has reported that its revenue in the latest quarter climbed 32% year-over-year to $518.7 million, while its net income narrowed to $12.9 million from $15.9 million a year earlier.

Is PYPL Stock a Buy?

It’s too early for Wall Street to rate Chime stock. So instead, we’ll look at rival PayPal. The stock of PayPal has a consensus Moderate Buy rating among 32 Wall Street analysts. That rating is based on 13 Buy, 16 Hold, and three Sell recommendations issued in the last three months. The average PYPL price target of $79.93 implies 7.13% upside from current levels.

Read more analyst ratings on PYPL stock