Analyst Joseph Vafi of Canaccord Genuity maintained a Hold rating on Open Lending, with a price target of $2.00.
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Joseph Vafi has given his Hold rating due to a combination of factors influencing Open Lending’s current financial and operational landscape. The company has shown progress by achieving its third consecutive quarter of positive adjusted EBITDA and launching a new product initiative, ApexOne Auto, aimed at the prime credit market. However, despite these advancements, the sequential decline in certified loan volumes and the challenges posed by higher used car prices and economic pressures on lower credit segments remain concerns.
Open Lending has made efforts to tighten its credit standards, reducing its exposure to riskier loan categories, which is expected to improve future loan performance. Nonetheless, the company’s financial results, including a net loss in the recent quarter, and the cautious guidance for the upcoming quarter reflect ongoing uncertainties. Consequently, while the company’s strategic initiatives are promising, the full impact on profitability and growth remains to be seen, justifying the Hold rating until more consistent positive cert volume is evident.
In another report released today, TR | OpenAI – 4o also upgraded the stock to a Hold with a $1.50 price target.