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Green Dot (GDOT)
NYSE:GDOT
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Green Dot
(NYSE:GDOT)
Rating:70Outperform
Price Target:
$10.50
▲(10.64%Upside)
Positive Factors
Earnings
Green Dot reported better than expected March quarter results and moderately raised full-year guidance.
Market Position
Green Dot is uniquely positioned to benefit from the growth of embedded finance.
Strategic Opportunities
The initiation of a process to explore potential strategic alternatives could unlock new opportunities for Green Dot.
Negative Factors
Guidance Concerns
Initial guidance for 2025 calls for a 6%-12% decline in adjusted EBITDA, driven by 8%-11% revenue growth, offset by margin decline.
Margin Pressure
Margin pressure has been driven by incremental costs and growth of the large BaaS customer.
Retail Division Challenges
Turning around the retail division will remain a challenge, as it fell 9% in 2024.
Green Dot (GDOT) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$520.91M
Dividend YieldN/A
Average Volume (3M)865.12K
Price to Earnings (P/E)―
Beta (1Y)0.82
Revenue Growth19.12%
EPS Growth75.50%
CountryUS
Employees1,150
SectorFinancial
Sector Strength74
IndustryFinancial - Credit Services
Share Statistics
EPS (TTM)1.06
Shares Outstanding54,890,760
10 Day Avg. Volume747,102
30 Day Avg. Volume865,118
Financial Highlights & Ratios
PEG Ratio0.35
Price to Book (P/B)1.08
Price to Sales (P/S)0.00
P/FCF Ratio4.36
Enterprise Value/Market Cap1.25
Enterprise Value/Revenue0.10
Enterprise Value/Gross Profit1.09
Enterprise Value/Ebitda2.48
Forecast
1Y Price Target
$11.67Price Target Upside22.97% Upside
Rating ConsensusHold
Number of Analyst Covering5
Green Dot Business Overview & Revenue Model
Company DescriptionGreen Dot Corporation (GDOT) is a financial technology and bank holding company based in the United States. It operates primarily in the fintech sector, offering a range of consumer financial products and services. Green Dot provides prepaid debit cards, bank accounts, and cash reload processing services. The company is known for its innovative banking solutions that cater to individuals who are often underserved by traditional banking institutions. Green Dot also offers banking as a service (BaaS) platform, enabling other businesses to integrate banking services into their own offerings.
How the Company Makes MoneyGreen Dot makes money through various revenue streams, primarily from fees associated with its prepaid debit cards, which include card purchase fees, monthly maintenance fees, ATM withdrawal fees, and transaction fees. Additionally, the company earns revenue from cash processing fees associated with its reload network, which allows users to add funds to their accounts. Green Dot's BaaS platform generates income by offering customizable banking solutions to third-party businesses, who pay for the integration and use of these services. Interest income from customer deposits and interchange fees from card transactions also contribute to the company's earnings. Key partnerships with retailers and financial institutions enhance Green Dot's reach and service offerings, further supporting its revenue generation.
Green Dot Earnings Call Summary
Earnings Call Date:May 08, 2025
(Q1-2025)
| % Change Since: 9.08%|
Next Earnings Date:Jul 31, 2025
Earnings Call Sentiment Positive
The earnings call reflects a predominantly positive sentiment with strong financial growth, new strategic partnerships, and successful renewals. However, challenges remain in certain segments, notably in rapid employer services and consumer services, and there was a notable financial loss in GAAP terms.Q1-2025 Updates
Positive Updates
Strong Financial Performance
Adjusted revenue increased by 24% and adjusted EBITDA rose by 53%. Non-GAAP EPS grew by 80% from last year, driven by strong performance across all segments.
Significant New Partnerships
Green Dot announced new partnerships with Samsung and Crypto.com, leveraging their ARC platform to enhance digital wallet functionalities and provide cash access solutions.
Walmart Partnership Renewal
The long-standing agreement with Walmart was extended through 2033, highlighting the strength and trust in the ongoing partnership.
B2B Segment Growth
The B2B segment, including BaaS, showed over 40% revenue growth, driven by significant partnerships and an expanding portfolio.
Improved Segment Profit
For the first time in many years, segment profit increased across all three segments, with notable performance in B2B and Money Movement.
Negative Updates
Challenges in Rapid Employer Services
The rapid employer services channel experienced revenue declines due to decreased active accounts and volumes, primarily caused by challenges in the staffing industry.
Consumer Services Segment Pressure
The Consumer services segment faced ongoing pressure with revenue and active account declines, though improvements were noted relative to prior years.
GAAP Financial Impact
A realized loss of $25 million on investment securities was reported due to the sale of bonds in early April, impacting GAAP financial results.
Company Guidance
In the first quarter of 2025, Green Dot Corporation delivered strong financial performance, with non-GAAP revenue increasing by 24% and adjusted EBITDA rising by 53%. The company saw growth across all three operating segments, with particularly robust results in the B2B and money movement segments. The B2B segment achieved over 40% revenue growth, while the money movement segment reported a 10% revenue increase in tax processing. Non-GAAP EPS surged by 80% year-over-year. Green Dot raised its full-year guidance, now expecting non-GAAP revenue between $2 billion and $2.1 billion, adjusted EBITDA between $150 million and $160 million, and non-GAAP EPS ranging from 1.14 to 1.28. The company's strategic initiatives, including partnerships with notable firms like Samsung and Crypto.com, as well as a renewed agreement with Walmart extending to 2033, are key drivers of this positive outlook.Green Dot Financial Statement Overview
Summary
Green Dot shows a mixed financial performance with revenue growth and operational efficiencies. However, profitability issues and negative net income are concerns. The balance sheet is strong with low leverage and cash flows are robust, indicating financial resilience.Income Statement
The income statement reflects moderate growth with a revenue increase of 6.2% TTM compared to the previous year. However, profitability is a concern as indicated by a negative net profit margin of -0.31% for TTM. Gross profit margin remains healthy at 32.67% but has decreased compared to previous years. The EBIT and EBITDA margins have shown improvement in the TTM, suggesting operational efficiency gains.72
Positive
Balance Sheet
The balance sheet is robust with a strong equity ratio of 16.54%, indicating a solid equity base relative to total assets. The debt-to-equity ratio is low at 0.08, reflecting low leverage and reduced financial risk. Return on equity is negative in TTM due to net losses, which is a point of concern.78
Positive
Cash Flow
Cash flow analysis shows a positive trajectory with free cash flow growing significantly by 206.1% in the TTM. Operating cash flow also improved, reflecting effective cash management. The operating cash flow to net income ratio is strong, indicating good cash generation capabilities despite net income challenges.85
Very Positive
| Breakdown | |||||
| TTM | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|---|
| Income Statement | Total Revenue | ||||
| 1.83B | 1.72B | 1.50B | 1.45B | 1.43B | 1.25B | Gross Profit |
| 597.99M | 580.08M | 620.54M | 723.91M | 694.43M | 726.89M | EBIT |
| 48.52M | -1.67M | 22.67M | 94.38M | 66.47M | 30.07M | EBITDA |
| 119.83M | 77.53M | 102.61M | 174.73M | 151.12M | 114.98M | Net Income Common Stockholders |
| -5.68M | -26.70M | 6.72M | 64.21M | 47.48M | 23.13M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | ||||
| 1.87B | 1.62B | 716.12M | 813.95M | 1.32B | 1.49B | Total Assets |
| 5.73B | 5.43B | 4.82B | 4.79B | 4.73B | 4.12B | Total Debt |
| 73.39M | 59.58M | 67.06M | 43.74M | 15.13M | 24.57M | Net Debt |
| -1.70B | -1.53B | -615.21M | -770.20M | -1.31B | -1.47B | Total Liabilities |
| 4.78B | 4.56B | 3.96B | 4.01B | 3.65B | 3.11B | Stockholders Equity |
| 947.66M | 873.59M | 859.35M | 781.48M | 1.07B | 1.01B |
| Cash Flow | Free Cash Flow | ||||
| 21.72M | 7.10M | 21.58M | 193.36M | 105.10M | 150.14M | Operating Cash Flow |
| 100.93M | 81.38M | 97.52M | 277.69M | 162.53M | 209.18M | Investing Cash Flow |
| 22.47M | 81.40M | 33.16M | -820.19M | -1.37B | -785.83M | Financing Cash Flow |
| 530.46M | 743.15M | -264.02M | 36.71M | 1.03B | 1.01B |
Green Dot Technical Analysis
Neutral
9.49
Price Trends
8.94
Positive
8.58
Positive
9.73
Negative
Market Momentum
0.26
Positive
48.50
Neutral
31.37
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For GDOT, the sentiment is Neutral. The current price of 9.49 is below the 20-day moving average (MA) of 9.67, above the 50-day MA of 8.94, and below the 200-day MA of 9.73, indicating a neutral trend. The MACD of 0.26 indicates Positive momentum. The RSI at 48.50 is Neutral, neither overbought nor oversold. The STOCH value of 31.37 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for GDOT.
Green Dot Risk Analysis
Green Dot disclosed 36 risk factors in its most recent earnings report. Green Dot reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Green Dot Peers Comparison
Overall Rating
UnderperformOutperform
Sector (64)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
80 Outperform | $2.35B | 6.75 | 17.91% | 2.91% | 4.99% | 25.93% | |
73 Outperform | $526.22M | 2.86 | 14.69% | 3.61% | 12.45% | -36.64% | |
70 Outperform | $520.91M | ― | -0.62% | ― | 19.12% | 75.50% | |
64 Neutral | $12.77B | 9.78 | 7.84% | 78.83% | 12.06% | -7.99% | |
64 Neutral | $478.87M | 12.16 | 2.77% | ― | 0.54% | ― | |
63 Neutral | $5.62B | ― | -10.30% | ― | 34.69% | 63.65% | |
57 Neutral | $1.28B | 25.24 | 3.86% | ― | 5.72% | 31.82% |
* Financial Sector Average
Performance Comparison
GDOT
Green Dot
9.49
<0.01
0.11%
LC
LendingClub
11.22
3.30
41.67%
YRD
Yiren Digital
6.09
1.47
31.82%
QD
Qudian
2.90
1.03
55.08%
FINV
FinVolution Group
9.51
4.87
104.96%
UPST
Upstart Holdings
59.08
37.44
173.01%
Green Dot Corporate Events
Shareholder Meetings
Green Dot Approves Amendments to Equity Plans
Positive
May 23, 2025
On May 22, 2025, Green Dot Corporation held its Annual Meeting of Stockholders, where stockholders approved amendments to the company’s 2010 Equity Incentive Plan and Employee Stock Purchase Plan. These amendments increase the authorized shares for issuance by 2.4 million and 5 million for the respective plans, potentially enhancing employee incentives and stockholder value.
The most recent analyst rating on (GDOT) stock is a Hold with a $14.00 price target. To see the full list of analyst forecasts on Green Dot stock, see the GDOT Stock Forecast page.
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.