Blend Labs (BLND) AI Stock Analysis

• Market Cap: $899.66M
• Dividend Yield: N/A
• Average Volume (3M): 2.50M
• Price to Earnings (P/E): ―
• Beta (1Y): 1.70
• Revenue Growth: -0.40%
• EPS Growth: 63.36%
• Country: US
• Employees: 540
• Sector: Technology
• Sector Strength: 77
• Industry: Software - Application
• EPS (TTM): -0.01
• Shares Outstanding: 254,775,970
• 10 Day Avg. Volume: 2,478,779
• 30 Day Avg. Volume: 2,497,962
• PEG Ratio: -0.49
• Price to Book (P/B): -16.04
• Price to Sales (P/S): 0.00
• P/FCF Ratio: -39.20
• Enterprise Value/Market Cap: 0.95
• Enterprise Value/Revenue: 1.37
• Enterprise Value/Gross Profit: 9.52
• Enterprise Value/Ebitda: -3.19
• 1Y Price Target: $5.31
• Price Target Upside: 50.00% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 5

• Rating: 55 Neutral
• Price Target: $3.50 ▼(-1.13%Downside)

Blend Labs' overall stock score reflects significant financial challenges, including negative profitability and equity, which pose substantial risks. However, positive aspects from the earnings call, such as strategic shifts and strong customer engagement, contribute to a more optimistic outlook. Technical indicators suggest moderate bullish potential, but valuation metrics remain a concern.

Positive Factors

Customer Engagement

New logo wins strong in Q1, with the company closing 3x as many new deals in Q1 vs a year ago, including a top-25 credit union.

Financial Performance

Profitability is increasing even at the current tepid level of mortgage volume, and the banking suite continues to gain traction, providing an increasingly meaningful contribution to the P&L, which is mostly uncorrelated with mortgage.

New Business Development

Blend is gaining new logos at an accelerating pace, while expanding but at the same time simplifying its product offerings via expanding use of partnerships.

Negative Factors

Competitive Threats

Blend's largest customer is getting bought by an indirect competitor in the form of a non-bank lender who views technology as 'the bedrock of its investment strategy,' and thus competes with Blend's software.

Interest Rate Environment

The interest rate environment did take an unexpected turn to a bit 'higher for longer,' impacting mortgage-related revenue.

Revenue Forecast

Guidance was disappointing with expected Blend Platform revenue falling short of consensus estimates.

Blend Labs Business Overview & Revenue Model

Company Description

Blend Labs, Inc. provides cloud-based software platform solutions for financial services firms in the United States. It operates in two segments, Blend Platform and Title365. The company offers a suite of white-label products for mortgages, home equity loans and lines of credit, vehicle loans, personal loans, credit cards, and deposit accounts. It also provides a suite of mortgage products that facilitates homeownership journey for consumers comprising close, income verification for mortgage, homeowners insurance, and realty. In addition, the company offers title search procedures for title insurance policies, escrow, and other closing and settlement services, as well as other trustee services; and professional and consulting services. It serves banks, credit unions, financial technology companies, and non-bank mortgage lenders. Blend Labs, Inc. was incorporated in 2012 and is headquartered in San Francisco, California.

How the Company Makes Money

Blend Labs generates revenue primarily through a software-as-a-service (SaaS) model, where financial institutions pay subscription fees to access and use its platform. Revenue streams include licensing fees based on transaction volume, which can vary depending on the number of applications processed through their system. Additionally, Blend may earn revenue from professional services such as implementation, customization, and ongoing support. Key partnerships with major banks and lenders help expand its market reach and drive adoption of its platform. Factors like the overall health of the mortgage and consumer lending markets, as well as the demand for digital transformation in financial services, significantly influence the company's earnings.

Blend Labs Financial Statement Overview

Summary

Blend Labs is navigating through significant financial challenges, particularly in achieving profitability and maintaining a stable financial position. The company has shown some marginal improvements in cash flow management, but persistent losses and negative equity pose substantial risks. Strategic restructuring and a focus on revenue growth are essential for future stability.

Income Statement

Blend Labs has shown a decrease in total revenue over the years, with a significant drop from 2022 to 2023. The gross profit margin remains decent at around 55.7% for TTM (Trailing-Twelve-Months), but the company is struggling with negative EBIT and net income margins, indicating continued operating losses. The net profit margin for TTM is -34.8%, reflecting ongoing challenges in achieving profitability.

Balance Sheet

The balance sheet reflects a concerning financial position with negative stockholders' equity for the TTM period, highlighting financial instability. The debt-to-equity ratio is not applicable due to negative equity. With liabilities exceeding assets, the equity ratio is negative, posing a significant risk. The company's financial structure requires restructuring to support sustainability.

Cash Flow

The cash flow statement shows some improvement in free cash flow, with the TTM free cash flow less negative compared to the previous year, indicating better cash management. However, the operating cash flow remains negative, and the free cash flow to net income ratio is less meaningful due to negative net income. The overall cash flow situation requires careful management to avoid liquidity issues.

Breakdown
Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement		Total Revenue
162.02M	156.85M	235.20M	234.50M	96.03M
	Gross Profit
90.54M	81.14M	89.65M	115.99M	61.74M
	EBIT
-49.62M	-156.22M	-281.22M	-197.24M	-75.29M
	EBITDA
-49.62M	-143.21M	-726.85M	-182.94M	-68.24M
	Net Income Common Stockholders
-49.60M	-185.32M	-763.81M	-169.14M	-74.62M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
98.48M	136.92M	354.15M	547.23M	151.72M
	Total Assets
178.01M	206.06M	432.76M	1.11B	215.75M
	Total Debt
3.83M	149.69M	231.98M	228.45M	16.58M
	Net Debt
-38.41M	118.73M	107.78M	15.37M	-24.51M
	Total Liabilities
181.99M	179.12M	268.84M	301.89M	52.41M
	Stockholders Equity
-56.36M	-19.24M	123.17M	774.64M	163.34M
Cash Flow		Free Cash Flow
-22.89M	-128.21M	-192.49M	-129.39M	-66.33M
	Operating Cash Flow
-13.04M	-127.62M	-190.42M	-127.50M	-65.01M
	Investing Cash Flow
45.40M	127.31M	99.43M	-633.91M	-7.92M
	Financing Cash Flow
-21.06M	-90.96M	2.22M	933.57M	90.76M

Blend Labs Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 3.54
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For BLND, the sentiment is Positive. The current price of 3.54 is above the 20-day moving average (MA) of 3.47, above the 50-day MA of 3.40, and below the 200-day MA of 3.81, indicating a neutral trend. The MACD of 0.06 indicates Negative momentum. The RSI at 55.32 is Neutral, neither overbought nor oversold. The STOCH value of 36.07 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for BLND.

Blend Labs Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
YALA	86 Outperform	$1.12B	9.21	21.03%	―	6.40%	9.72%
VTEX	71 Outperform	$1.13B	74.84	6.26%	―	7.71%	―
RSKD	71 Outperform	$776.89M	―	-9.00%	―	9.30%	24.96%
DSP	69 Neutral	$843.40M	447.84	4.15%	―	30.64%	―
FSLY	68 Neutral	$1.04B	―	-15.78%	―	6.26%	-9.54%
Sector *	61 Neutral	$11.29B	10.17	-6.88%	2.97%	7.41%	-8.93%
BLND	55 Neutral	$899.66M	―	-93.00%	―	-0.40%	63.36%

Blend Labs Corporate Events

Blend Labs Reports Strong Q1 2025 Financial Results

On May 8, 2025, Blend Labs announced its first quarter 2025 financial results, highlighting a third consecutive quarter of year-over-year growth driven by increased customer engagement. The company reported a platform revenue of $26.8 million, exceeding expectations, and achieved a record first quarter signings with performance obligations up 70% year-over-year. Blend also generated positive free cash flow for the first time, marking a significant financial milestone. Additionally, Blend is in an exclusive process to potentially sell its title insurance business, aligning with its strategic shift to a software-first model.

Blend Labs Reports Strong Q4 2024 Financial Results

On February 27, 2025, Blend Labs announced its financial results for the fourth quarter and full year 2024, highlighting significant achievements despite challenging macroeconomic conditions. The company reported a 42% annual revenue growth in its Consumer Banking business and welcomed major new customers, including PHH Mortgage and a top 10 U.S. bank. Blend achieved its most profitable quarter yet, with a 15% year-over-year revenue increase in Q4 to $41.4 million, driven by strategic partnerships and product innovations. The company also reported a non-GAAP operating income of $5.2 million, surpassing guidance, and continued to diversify its revenue streams with a focus on high-margin partnerships and software model simplification.