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Open Lending Corporation (LPRO)
NASDAQ:LPRO
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Open Lending
(NASDAQ:LPRO)
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Rating:45Neutral
Price Target:
$2.00
▼(-11.11% Downside)
Open Lending's overall stock score is primarily impacted by its poor financial performance, with severe profitability and cash flow issues. While the earnings call provided some positive strategic developments, the technical analysis and valuation remain concerning. The stock faces significant challenges that need addressing to improve its attractiveness.
Positive Factors
Strategic Partnership Extension
The extension of the AmTrust agreement secures long-term credit capability and capacity, reinforcing a strong partnership that supports business stability and growth.
Improved Unit Economics
Efforts to improve unit economics by optimizing efficiencies and reducing expenses enhance profitability and reduce business volatility, supporting sustainable growth.
New CFO Appointment
The appointment of an experienced CFO can strengthen financial leadership, improve strategic financial management, and drive long-term business success.
Negative Factors
Declining Revenue
A decline in revenue, particularly from profit share, indicates challenges in maintaining growth momentum, which can impact financial health and investor confidence.
Decreasing Certified Loans
A decrease in certified loans suggests reduced lending activity, potentially impacting revenue and market share in the competitive auto finance sector.
Rising Operating Expenses
Increased operating expenses can strain profitability and cash flow, necessitating cost control measures to ensure long-term financial stability.
Open Lending (LPRO) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$265.89M
Dividend YieldN/A
Average Volume (3M)619.01K
Price to Earnings (P/E)72.9
Beta (1Y)2.58
Revenue Growth-83.48%
EPS Growth-2400.00%
CountryUS
Employees205
SectorFinancial
Sector Strength70
IndustryFinancial - Credit Services
Share Statistics
EPS (TTM)0.01
Shares Outstanding118,172,480
10 Day Avg. Volume504,013
30 Day Avg. Volume619,009
Financial Highlights & Ratios
PEG Ratio<0.01
Price to Book (P/B)9.11
Price to Sales (P/S)29.62
P/FCF Ratio40.81
Enterprise Value/Market Cap0.48
Enterprise Value/Revenue7.91
Enterprise Value/Gross Profit-16.62
Enterprise Value/Ebitda-2.00
Forecast
1Y Price Target
$2.96Price Target Upside31.56% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering6
Open Lending Business Overview & Revenue Model
Company DescriptionOpen Lending Corporation provides lending enablement and risk analytics solutions to credit unions, regional banks, and non-bank auto finance companies and captive finance companies of original equipment manufacturers in the United States. It offers Lenders Protection Program (LPP), which is a Software as a Service platform that facilitates loan decision making and automated underwriting by third-party lenders and the issuance of credit default insurance through third-party insurance providers. The company's LPP products include loan analytics, risk-based loan pricing, risk modeling, and automated decision technology for automotive lenders. Open Lending Corporation was founded in 2000 and is based in Austin, Texas.
How the Company Makes MoneyOpen Lending generates revenue primarily through its SaaS (Software as a Service) business model, charging lenders a fee for access to its technology platform and services. Key revenue streams include transaction fees based on the volume of loans facilitated through its platform, subscription fees for software access, and fees for additional services such as risk assessment and analytics. The company also benefits from strategic partnerships with various financial institutions and auto dealerships, which help to expand its client base and enhance revenue opportunities. These partnerships enable Open Lending to leverage its technology to streamline the lending process, thereby increasing overall market penetration and driving revenue growth.
Open Lending Earnings Call Summary
Earnings Call Date:Aug 06, 2025
(Q2-2025)
| % Change Since: |
Next Earnings Date:Nov 11, 2025
Earnings Call Sentiment Neutral
The earnings call reflects a mixed sentiment with several positive strategic developments such as the early extension of the AmTrust agreement and improved unit economics. However, challenges like the decrease in certified loans and increased operating expenses also highlight areas for improvement.Q2-2025 Updates
Positive Updates
Early Extension of Agreement with AmTrust
Open Lending announced an early extension of its producer agreement with AmTrust through 2033, reflecting strong partnership confidence and securing credit capability and capacity.
Reduction in Operating Expenses and Improved Unit Economics
The company has made substantial progress in optimizing efficiencies, reducing expenses, and improving the quality of the loan portfolio with a focus on profitable, less volatile unit economics.
Positive Developments in Credit Union Partnerships
Credit union financial positions are strengthening, with total assets in federally insured credit unions rising by $79 billion or 3.5% year-over-year. Total loan growth and share growth also improved.
New CFO Appointment
Massimo Monaco has been appointed as the new CFO, bringing over two decades of experience in lending and financial services.
Negative Updates
Decrease in Certified Loans
The company facilitated 26,522 certified loans, down from 28,963 in the prior year period, primarily due to seasonal factors and intentionally tightened lending standards.
Decline in Total Revenue
Total revenue for the second quarter of 2025 was $25.3 million, including an $8.3 million reduction in estimated profit share revenue associated with new originations.
Increase in Operating Expenses
Operating expenses increased by 9% year-over-year, partially due to onetime severance expenses.
Company Guidance
In the second quarter of 2025, Open Lending reported significant progress on its strategic priorities, focusing on improving profitability and reducing volatility. They facilitated 26,522 certified loans, down from 28,963 in the previous year, attributed to seasonality and tightened lending standards. The company announced an early extension of its agreement with AmTrust, their largest insurance partner, through 2033, reinforcing their strong partnership. Total revenue was $25.3 million, with program fee revenues at $14.9 million, profit share revenue at $8 million, and claims administration fees at $2.4 million. Operating expenses increased to $18.6 million, partly due to onetime severance charges, with plans to implement cost-saving measures by year-end. Net income stood at $1 million, down from $2.9 million the previous year, with an adjusted EBITDA of $4.1 million. Guidance for the third quarter anticipates certified loans between 22,500 and 24,500, emphasizing a continued focus on quality over quantity in their lending portfolio.Open Lending Financial Statement Overview
Summary
Open Lending faces severe financial challenges, with negative profit margins and declining revenue. The balance sheet shows reduced leverage but negative ROE, and cash flow analysis indicates weak cash generation. These issues significantly impact the company's financial health.Income Statement
Open Lending's income statement shows significant challenges. The TTM data indicates a negative gross profit margin of -47.55% and a net profit margin of -869.57%, highlighting severe profitability issues. Revenue has been declining, with a TTM revenue growth rate of -8.02%. Historical data shows a consistent decline in revenue and profitability, with the most recent annual report showing a net profit margin of -561.98%. The company is struggling to maintain positive margins and growth, which is a major concern.25
Negative
Balance Sheet
The balance sheet reflects a mixed financial position. The TTM debt-to-equity ratio has improved to 0.13 from a high of 6.13 in 2020, indicating reduced leverage. However, the return on equity is negative at -123.63%, showing that the company is not generating returns for shareholders. The equity ratio is relatively stable, but the negative ROE and historical high leverage present risks.40
Negative
Cash Flow
Cash flow analysis reveals declining free cash flow growth, with a TTM rate of -351.81%. The operating cash flow to net income ratio is low at 0.11, indicating weak cash generation relative to net income. Although the free cash flow to net income ratio is 0.56, the overall cash flow position is concerning due to declining free cash flow and weak cash flow coverage.30
Negative
| Breakdown | TTM | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 16.25M | 24.02M | 117.46M | 179.59M | 215.66M | 108.89M |
| Gross Profit | -7.73M | 169.00K | 95.18M | 159.63M | 197.03M | 99.11M |
| EBITDA | -64.20M | -51.61M | 41.30M | 100.87M | 198.69M | -77.62M |
| Net Income | -141.35M | -135.01M | 22.07M | 66.62M | 146.08M | -97.56M |
Balance Sheet | ||||||
| Total Assets | 296.66M | 296.37M | 374.04M | 379.63M | 318.82M | 294.01M |
| Cash, Cash Equivalents and Short-Term Investments | 230.66M | 243.16M | 240.21M | 204.45M | 116.45M | 101.51M |
| Total Debt | 189.35M | 143.77M | 148.13M | 151.51M | 150.90M | 163.25M |
| Total Liabilities | 217.71M | 218.28M | 168.46M | 166.81M | 159.84M | 267.39M |
| Stockholders Equity | 78.95M | 78.09M | 205.58M | 212.82M | 158.98M | 26.62M |
Cash Flow | ||||||
| Free Cash Flow | 2.79M | 17.43M | 80.48M | 106.81M | 93.17M | 23.44M |
| Operating Cash Flow | 5.01M | 17.60M | 82.66M | 107.43M | 95.16M | 24.64M |
| Investing Cash Flow | -3.00M | -3.90M | -2.18M | -624.00K | -1.99M | -1.20M |
| Financing Cash Flow | -13.13M | -6.45M | -42.33M | -17.80M | -77.81M | 70.81M |
Open Lending Technical Analysis
Positive
2.25
Price Trends
2.25
Positive
2.09
Positive
3.26
Negative
Market Momentum
<0.01
Negative
54.45
Neutral
66.33
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For LPRO, the sentiment is Positive. The current price of 2.25 is above the 20-day moving average (MA) of 2.17, above the 50-day MA of 2.25, and below the 200-day MA of 3.26, indicating a neutral trend. The MACD of <0.01 indicates Negative momentum. The RSI at 54.45 is Neutral, neither overbought nor oversold. The STOCH value of 66.33 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for LPRO.
Open Lending Risk Analysis
Open Lending disclosed 48 risk factors in its most recent earnings report. Open Lending 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
Open Lending Peers Comparison
Overall Rating
UnderperformOutperform
Sector (68)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
77 Outperform | 244.55M | 6.12 | 10.73% | 4.28% | 15.88% | -1.83% | |
76 Outperform | 521.03M | 2.94 | 16.58% | 6.47% | 12.69% | -35.36% | |
64 Neutral | 620.34M | -165.67 | 6.07% | ― | 276.86% | 0.00% | |
62 Neutral | 181.13M | 10.16 | 6.41% | ― | 16.13% | -28.76% | |
58 Neutral | 312.47M | -35.75 | -22.24% | ― | -5.87% | 94.07% | |
45 Neutral | $265.89M | 72.92 | -95.59% | ― | -83.48% | -2400.00% | |
68 Neutral | $18.00B | 11.42 | 9.92% | 3.81% | 9.73% | 1.22% |
* Financial Sector Average
Performance Comparison
LPRO
Open Lending
2.25
-3.71
-62.25%
CPSS
Consumer Portfolio Services
8.15
-1.48
-15.37%
MFIN
Medallion Financial
10.52
2.92
38.42%
YRD
Yiren Digital
6.03
1.79
42.22%
FOA
Finance of America Companies
25.53
14.64
134.44%
OPRT
Oportun Financial
7.10
4.18
143.15%
Open Lending Corporate Events
Executive/Board Changes
Open Lending Terminates Chief Revenue Officer
Negative
Aug 4, 2025
On July 29, 2025, Open Lending terminated the employment of its Chief Revenue Officer, Matthew R. Roe. This decision may impact the company’s operations and leadership dynamics.
The most recent analyst rating on (LPRO) stock is a Buy with a $2.50 price target. To see the full list of analyst forecasts on Open Lending stock, see the LPRO 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.