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Medallion Financial (MFIN)
NASDAQ:MFIN
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Medallion Financial
(NASDAQ:MFIN)
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Rating:74Outperform
Price Target:
$11.00
▲(9.02% Upside)
Action:ReiteratedDate:01/30/26
The score is driven primarily by strong financial performance (especially cash flow strength and manageable leverage) and very favorable valuation (low P/E plus solid dividend). These positives are tempered by weak technical momentum and credit-cost/operating-expense risks highlighted in the latest earnings update, though corporate actions like exiting medallion exposure and strengthening capital are supportive.
Positive Factors
Strategic Partnership Program Growth
The consistent growth in strategic partnerships indicates a strong network effect and enhances Medallion Financial's ability to expand its market reach and diversify its revenue streams, contributing to long-term business stability and growth.
Leadership Transition
The leadership transition is poised to drive strategic growth and innovation, leveraging technology and data insights to expand the lending platform, which could strengthen the company's competitive position and market presence.
Strong Cash Flow Generation
Robust cash flow generation enhances financial flexibility, allowing for reinvestment in growth opportunities, debt reduction, or shareholder returns, thus supporting long-term financial health and stability.
Negative Factors
Rising Delinquencies
Increasing delinquencies and higher credit loss allowances indicate potential credit risk, which could impact profitability and necessitate more conservative lending practices, affecting future growth.
Decline in Home Improvement Loans
A decline in home improvement loans suggests potential challenges in this segment, which could limit revenue growth and diversification if not addressed, impacting the company's overall loan portfolio balance.
Increased Operating Costs
Rising operating costs, driven by technological initiatives and higher employee expenses, could pressure profit margins if revenue growth does not keep pace, impacting long-term profitability.
Medallion Financial (MFIN) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$234.89M
Dividend Yield4.44%
Average Volume (3M)43.20K
Price to Earnings (P/E)5.7
Beta (1Y)0.51
Revenue Growth15.52%
EPS Growth2.05%
CountryUS
Employees174
SectorFinancial
Sector Strength70
IndustryFinancial - Credit Services
Share Statistics
EPS (TTM)0.50
Shares Outstanding23,279,434
10 Day Avg. Volume47,971
30 Day Avg. Volume43,203
Financial Highlights & Ratios
PEG Ratio-0.17
Price to Book (P/B)0.57
Price to Sales (P/S)0.73
P/FCF Ratio1.83
Enterprise Value/Market Cap1.49
Enterprise Value/Revenue1.07
Enterprise Value/Gross Profit2.38
Enterprise Value/Ebitda4.08
Forecast
1Y Price Target
$12.00Price Target Upside18.93% Upside
Rating ConsensusHold
Number of Analyst Covering1
EPS Forecast (FY)1.59
Revenue Forecast (FY)N/A
Medallion Financial Business Overview & Revenue Model
Company DescriptionMedallion Financial Corp., together with its subsidiaries, operates as a finance company in the United States. The company operates through four segments: Recreation Lending, Home Improvement Lending, Commercial Lending, and Medallion Lending. It provides loans that finance consumer purchases of recreational vehicles, boats, and trailers; consumer home improvements; commercial businesses; and taxi medallions to individuals, and small to mid-size businesses. The company also offers commercial loans for purchase of equipment and related assets necessary to open a new business, or purchase or improvement of an existing business; and medallion loans. In addition, it provides debt, mezzanine, and equity investment capital to companies in various industries; and raises deposits and conducts other banking activities. Medallion Financial Corp. was incorporated in 1995 and is headquartered in New York City, New York.
How the Company Makes MoneyMedallion Financial generates revenue primarily through interest income from its loan portfolio, which includes medallion loans, commercial loans, and consumer loans. The company earns interest on the principal amount of loans it disburses, and its revenue is significantly affected by the volume of loans it originates and the prevailing interest rates. Additionally, Medallion Financial may earn fees related to loan origination, servicing, and other transactional activities. The company's revenue can also be bolstered by partnerships with various financial institutions and organizations that facilitate access to capital or enhance its service offerings, although specific partnerships and their financial impact are not detailed.
Medallion Financial Earnings Call Summary
Earnings Call Date:Feb 18, 2026
(Q4-2025)
| % Change Since: |
Next Earnings Date:May 04, 2026
Earnings Call Sentiment Positive
The call conveyed a predominantly positive tone driven by record annual results, growth in net interest income, increased loan balances and originations, strong equity gains, improved book values, and successful diversification (strategic partnerships). However, the quarter also showed notable credit and expense headwinds: a sizable provision build, elevated recreation net charge-offs and delinquency, higher operating expenses, and potential margin pressure from rate moderation. Management presented clear actions (talent additions, capital availability, data-driven underwriting) and expects disciplined mid-teens growth in key lines, suggesting confidence in resolving near-term credit and margin dynamics while pursuing sustainable growth.Q4-2025 Updates
Positive Updates
Record Year and Top-Line Growth
2025 marked a record year with increases in net interest income, net income, originations, and portfolio size. Total originations were $421,000,000 for the quarter and $1,500,000,000 for the full year. Total loans reached $2,567,000,000, up 3% year-over-year.
Net Interest Income and Margin Expansion
Net interest income grew 8% in the fourth quarter to $56,400,000 (from $52,000,000) and 7% for the year to $216,900,000 (from $202,500,000). Net interest margin was 8.04% in the quarter, up 20 basis points year-over-year; total interest yield rose 16 basis points to 11.7%.
Consumer Lending Strength
Consumer interest income was $74,500,000 for the quarter and $289,900,000 for the year (growing ~5% vs. same period and ~8% year-over-year). Direct loan book grew 5% to $1,600,000,000 (63% of total loans). Recreation originations rose to $97,200,000 (from $72,200,000 a year ago) and interest income for recreation increased ~6% to $54,200,000.
High-Quality Home Improvement Book
Home improvement loans totaled $810,200,000 (32% of total loans). Q4 originations were $61,700,000 (down from $82,500,000 year-ago quarter), delinquency 90+ days just 0.16%, allowance at 2.41% (slightly improved from 2.48% a year ago), and average FICO on new originations ~779, indicating strong credit quality.
Commercial Lending and Equity Gains
Commercial portfolio rose to $123,100,000 (from $111,300,000), with average interest rate increasing to 14.22% (from 12.97%). Gains from equity investments were $8,800,000 in Q4 and $24,600,000 for the year, contributing meaningfully to earnings.
Strategic Partnership Program Expansion
Strategic partnership originations reached a record $258,300,000 in the quarter (second straight quarter > $200M). Though short-duration on-book, the program generated approximately $1,800,000 in income this quarter and $5,400,000 for the year (more than doubled from prior year), diversifying revenue.
Taxi Medallion Legacy Wind-Down Progress
Collected $2,500,000 cash in the quarter and $13,600,000 for the year from legacy taxi medallion assets, producing net recoveries/gains of $1,400,000 in Q4 and $4,600,000 for the year. Net taxi medallion assets declined to $4,300,000, now <0.2% of total assets.
Capital Returns and Book Value Improvement
Quarterly dividend maintained at $0.12 per share; net income attributable to shareholders was $12,200,000 in Q4 ($0.50 per diluted share), up $2,100,000 vs prior-year quarter. Full-year net income was $43,000,000 ($1.78 per share), up $7,200,000. Net book value per share increased to $17.53 (from $16.00 year-ago) and adjusted tangible book value per share rose to $12.12 (from $10.50 year-ago).
Negative Updates
Elevated Provision for Credit Losses
Provision for credit losses spiked to $27,700,000 in Q4 (up from $18,600,000 in 3Q and $20,600,000 in prior-year quarter). Drivers included recharacterization of loans from held-for-sale to held-for-investment, allowance coverage step-up (from ~5.0% to 5.32%), and additional commercial loan provisions.
High Net Charge-Offs in Recreation Portfolio
Net charge-offs in the recreation portfolio were $17,900,000 in Q4, equating to 4.41% of the total average recreation portfolio (4.53% on held-for-investment recreation), indicating elevated losses in that segment despite risk-adjusted pricing.
Rising Delinquencies and Slight Deterioration in Consumer 90+ Days
Consumer loans more than 90 days past due totaled $14,200,000, or 0.6% of total consumer loans, up from 0.5% a year ago. Recreational 90+ days were 0.82% of gross recreational loans, showing pressure in the rec originations cohort.
Quarterly Operating Expense Increase
Operating costs rose to $22,200,000 in Q4 from $17,200,000 in the prior-year quarter, largely due to a $5,500,000 insurance benefit realized in the prior year (i.e., loss of that benefit in the current year) and higher employee costs. Management expects higher non-interest operating costs as the company scales.
Home Improvement Originations Down Sequentially/Year-Over-Year Quarter
Home improvement originations were $61,700,000 in Q4, down from $82,500,000 a year ago (though management expects mid-teens growth in the portfolio in 2026 following added experienced talent and capital availability).
Commercial Originations Weakness in Quarter
Commercial new originations in the quarter were $4,100,000 versus $7,300,000 in the same quarter a year ago, reflecting mid-quarter variability despite full-year commercial originations increasing to $40,600,000 from $14,300,000 in 2024.
Margin Pressure Risk from Lowered Origination Rates
Management indicated they lowered recreation origination rates (January averages ~14.5% vs portfolio weighted 15.17% as of 12/31), which could pressure net interest margin (management noted it may drop below ~8% even if credit-adjusted yields are targeted to improve).
Company Guidance
Management guided that 2026 will emphasize disciplined, accretive growth — targeting mid‑teens growth across the loan book (with mid‑teens growth called out for home improvement) while scaling recreation and the fast‑growing strategic partnership channel — noting the company ended 2025 with $2.567B of total loans, Q4 originations of $421M (including a record $258.3M from strategic partnerships), January origination rates of ~14.5% for recreation and ~10% for home improvement, a Q4 net interest margin of 8.04% (FY 8.06%) that management said could dip below 8% if recreation pricing is reduced, and an expectation that net interest income growth will outpace rising non‑interest operating costs; they also said the elevated Q4 provision of $27.7M should not be a run‑rate item even as allowances grow with the book (recreation allowance 5.32% and 90+ day delinquencies 0.82%, home improvement allowance 2.41% and 90+ day delinquencies 0.16%), and confirmed continued capital returns (quarterly dividend $0.12/sh and ongoing buybacks).Medallion Financial Financial Statement Overview
Summary
Financial statements are solid overall: stable revenue growth and profitability (TTM net margin 12.47%), strong cash generation (TTM free cash flow growth 48.96% with good cash conversion), and manageable leverage (debt-to-equity 0.75). A key risk is pressure in profit/gross margins, which could weigh on future profitability if it persists.Income Statement
Medallion Financial has shown consistent revenue growth over the years, with a TTM revenue growth rate of 3.52%. The company maintains a healthy net profit margin of 12.47% in the TTM, indicating profitability. However, there has been a decline in gross profit margin from previous years, which could be a concern if it continues. Overall, the income statement reflects a stable financial performance with room for improvement in cost management.75
Positive
Balance Sheet
The company's debt-to-equity ratio has remained relatively stable, currently at 0.75, which is manageable. Return on equity is at 10.66% for the TTM, showing effective use of equity to generate profits. However, the equity ratio is not explicitly provided, which limits a full assessment of asset financing. The balance sheet indicates a balanced approach to leveraging and equity utilization.70
Positive
Cash Flow
Medallion Financial has demonstrated strong free cash flow growth of 48.96% in the TTM, indicating robust cash generation capabilities. The operating cash flow to net income ratio is close to 1, suggesting efficient conversion of income to cash. The company maintains a consistent free cash flow to net income ratio of 1.0, reflecting solid cash flow management. Overall, the cash flow statement is a strong point for the company.80
Positive
| Breakdown | TTM | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 327.23M | 291.79M | 254.51M | 198.43M | 179.21M | 151.36M |
| Gross Profit | 146.85M | 127.12M | 153.76M | 132.19M | 143.44M | 47.39M |
| EBITDA | 85.77M | 69.15M | 91.28M | 73.08M | 88.39M | -29.27M |
| Net Income | 44.50M | 35.88M | 55.08M | 43.84M | 54.11M | -34.78M |
Balance Sheet | ||||||
| Total Assets | 2.90B | 2.87B | 2.59B | 2.26B | 1.87B | 1.64B |
| Cash, Cash Equivalents and Short-Term Investments | 74.87M | 101.17M | 106.87M | 81.66M | 106.25M | 98.53M |
| Total Debt | 301.71M | 288.59M | 253.06M | 229.93M | 231.23M | 254.07M |
| Total Liabilities | 2.40B | 2.43B | 2.18B | 1.89B | 1.52B | 1.34B |
| Stockholders Equity | 397.45M | 370.17M | 342.99M | 301.74M | 287.04M | 231.41M |
Cash Flow | ||||||
| Free Cash Flow | 120.88M | 115.51M | 113.76M | 108.74M | 78.73M | 78.71M |
| Operating Cash Flow | 120.88M | 115.51M | 113.76M | 108.74M | 78.73M | 78.71M |
| Investing Cash Flow | -173.84M | -335.78M | -340.70M | -449.00M | -238.32M | -170.96M |
| Financing Cash Flow | 16.01M | 239.99M | 271.18M | 321.38M | 172.04M | 136.47M |
Medallion Financial Technical Analysis
Negative
10.09
Price Trends
10.29
Negative
10.07
Positive
9.89
Positive
Market Momentum
-0.02
Positive
45.62
Neutral
24.93
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For MFIN, the sentiment is Negative. The current price of 10.09 is below the 20-day moving average (MA) of 10.29, below the 50-day MA of 10.29, and above the 200-day MA of 9.89, indicating a neutral trend. The MACD of -0.02 indicates Positive momentum. The RSI at 45.62 is Neutral, neither overbought nor oversold. The STOCH value of 24.93 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for MFIN.
Medallion Financial Risk Analysis
Medallion Financial disclosed 41 risk factors in its most recent earnings report. Medallion Financial 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
Medallion Financial Peers Comparison
UnderperformOutperform
Sector (68)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
74 Outperform | $234.89M | 5.67 | 10.79% | 4.44% | 15.52% | 2.05% | |
68 Neutral | $18.00B | 11.42 | 9.92% | 3.81% | 9.73% | 1.22% | |
64 Neutral | $228.59M | 9.78 | 8.59% | ― | -5.29% | ― | |
63 Neutral | $299.01M | 7.15 | 11.43% | 2.99% | 9.63% | 77.14% | |
59 Neutral | $178.78M | 10.06 | 6.58% | ― | 16.94% | -10.46% | |
49 Neutral | $157.19M | -1.06 | -102.53% | ― | -82.33% | -3365.80% | |
48 Neutral | $104.67M | -2.27 | -20.35% | ― | -19.68% | -1055.59% |
* Financial Sector Average
MFIN
Medallion Financial
10.09
2.38
30.84%
CPSS
Consumer Portfolio Services
8.10
-1.56
-16.15%
RM
Regional Management
31.82
0.66
2.11%
LPRO
Open Lending
1.33
-3.25
-70.96%
SUIG
Sui Group Holdings
1.26
-0.64
-33.68%
OPRT
Oportun Financial
5.18
-1.89
-26.73%
Medallion Financial Corporate Events
Business Operations and StrategyDividendsFinancial DisclosuresPrivate Placements and Financing
Medallion Financial posts strong Q4 results, exits medallions
Positive
Jan 29, 2026
On January 29, 2026, Medallion Bank reported strong results for the fourth quarter and full year ended December 31, 2025, highlighted by a 24% year-over-year increase in quarterly net income to $19.4 million and a 19% rise in full-year net income to $72.2 million. Net interest income and margins improved modestly, while non-interest income surged on the sale of the bank’s remaining taxi medallion assets, effectively exiting that legacy exposure and boosting profitability. Strategic partnership loan originations more than tripled in 2025 to $771.6 million, underscoring the growing importance of fintech relationships, and the total loan portfolio expanded to $2.4 billion with return on equity rising to 17.05%. Recreation lending remained the largest book at $1.617 billion with higher originations and slightly elevated charge-offs and provisions, reflecting both growth and tighter credit risk management, while the smaller home improvement segment saw reduced originations but improved asset quality, lower delinquencies and lower credit loss provisions. Capital levels were further strengthened as total capital increased to $450.2 million, aided by the net $27.1 million uplift from the issuance of Series G preferred stock and redemption of Series F, and the board declared a quarterly cash dividend on the Series G shares payable on April 1, 2026, signaling confidence in the bank’s capital position and earnings capacity.
The most recent analyst rating on (MFIN) stock is a Buy with a $11.00 price target. To see the full list of analyst forecasts on Medallion Financial stock, see the MFIN Stock Forecast page.
Business Operations and StrategyExecutive/Board Changes
Medallion Financial Realigns Medallion Bank Executive Leadership Roles
Neutral
Jan 12, 2026
On January 12, 2026, Medallion Financial Corp. and its subsidiary Medallion Bank implemented senior leadership changes through amended employment agreements with two key executives. Donald Poulton relinquished the title of president of Medallion Bank but remained its chief executive officer for the balance of his existing employment term, while David Justin Haley transitioned from executive vice president and chief financial officer to president of Medallion Bank under a new two‑year employment agreement that automatically renews, sets his annual base salary at $430,000 effective January 1, 2026, and provides severance protections and a non‑competition covenant, signaling a planned realignment of the bank’s executive structure without altering Poulton’s broader contractual terms.
The most recent analyst rating on (MFIN) stock is a Buy with a $11.00 price target. To see the full list of analyst forecasts on Medallion Financial stock, see the MFIN 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.