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NerdWallet, Inc. Class A (NRDS)
NASDAQ:NRDS

NerdWallet, Inc. Class A (NRDS) AI Stock Analysis

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NerdWallet, Inc. Class A

(NASDAQ:NRDS)

Rating:69Neutral
Price Target:
$12.50
▲(10.42%Upside)
NerdWallet's strong financial performance and positive earnings call are the most significant factors driving the score. Technical indicators and recent corporate events provide additional support but are less impactful. Valuation concerns slightly offset the positive outlook.
Positive Factors
Earnings
Shares were up 8% due to a significant earnings beat and a strong outlook, which may shift investor focus away from organic search traffic declines.
Insurance Sector Performance
Insurance revenue is growing significantly and now comprises a large portion of total revenue, positioning it as the primary driver of year-over-year revenue growth.
Revenue Growth
Revenue of $209 million increased 29% from the year-ago quarter and was above Street expectations.
Negative Factors
Organic Traffic Decline
NerdWallet continues to struggle to attract organic search traffic, leading to a shift towards lower-margin paid traffic.
Revenue Estimate Risks
There is concern about the company's reliance on the insurance segment, which could put revenue estimates at risk if other segments do not improve.
Traffic Concerns
Continued traffic deceleration is driving a strategy shift towards higher LTV customers versus incremental MUUs.

NerdWallet, Inc. Class A (NRDS) vs. SPDR S&P 500 ETF (SPY)

NerdWallet, Inc. Class A Business Overview & Revenue Model

Company DescriptionNerdWallet, Inc. Class A (NRDS) operates as a personal finance company, providing a platform that offers financial guidance to consumers and small and medium-sized businesses. The company is primarily focused on helping users make informed decisions about their finances through various tools, resources, and expert advice. NerdWallet covers multiple financial sectors, including banking, credit cards, loans, insurance, and investments, providing a comprehensive suite of solutions to its users.
How the Company Makes MoneyNerdWallet makes money primarily through affiliate marketing and lead generation. The company partners with financial institutions and service providers, earning a commission or fee when users engage with these third-party partners through NerdWallet's platform. This includes actions such as signing up for credit cards, applying for loans, or purchasing insurance. Key revenue streams include commissions on credit card sign-ups, loan originations, and other financial products facilitated through NerdWallet's recommendations. The company also collaborates with advertisers who wish to reach NerdWallet's audience, generating additional advertising revenue. Significant partnerships with banks, credit card companies, and insurers are crucial for NerdWallet's earnings, as these relationships expand the range of options available to users and enhance the company's ability to monetize its platform.

NerdWallet, Inc. Class A Earnings Call Summary

Earnings Call Date:May 06, 2025
(Q1-2025)
|
% Change Since: 33.81%|
Next Earnings Date:Jul 30, 2025
Earnings Call Sentiment Positive
The earnings call presented a positive picture with strong revenue growth driven by the Insurance segment and a return to growth in personal loans. However, challenges remain in the credit card and SMB product segments, and MUU growth is expected to stabilize in the future.
Q1-2025 Updates
Positive Updates
Revenue Growth
NerdWallet reported a 29% year-over-year increase in revenue, reaching $209 million for Q1 2025.
Insurance Segment Performance
The Insurance business delivered $74 million in revenue, growing 246% year-over-year, showcasing strong market demand and effective improvements in shopping experiences.
Emerging Verticals and Banking
Emerging verticals, primarily driven by banking, grew 15% year-over-year with robust partner appetite as consumers seek low-risk options.
Return to Growth in Personal Loans
The personal loans segment saw a return to growth after a 51% decline in Q4 2024, driven by improved funnel personalization and lender panel expansion.
Non-GAAP Operating Income
Achieved $9 million in non-GAAP operating income, exceeding profitability guidance.
Negative Updates
Credit Cards Revenue Decline
Credit card revenue declined 24% year-over-year, affected by downward pressure in organic search.
SMB Products Revenue Decline
SMB products experienced a 5% year-over-year revenue decline due to tight underwriting and trade policy uncertainty.
Challenges with MUU Growth
Monthly Unique Users (MUUs) continued to decline year-over-year, although a 7% increase was noted from Q4 levels.
Company Guidance
During the NerdWallet Q1 2025 earnings call, several key metrics and guidance were discussed. The company reported a 29% year-over-year increase in revenue to $209 million, alongside $9 million in non-GAAP operating income. Insurance revenue grew 246% year-over-year, contributing significantly to the overall performance, while personal loans returned to growth after a previous decline. The company ended the quarter with over 26 million registered users and robust growth in their CRM channel. Looking forward, NerdWallet expects Q2 revenue between $192 million and $200 million, with non-GAAP operating income ranging from $14 million to $18 million. For the full year, non-GAAP operating income is projected to be between $55 million and $66 million. Despite challenges in the macroeconomic environment, the company remains optimistic about returning to MUU growth by early 2026 and continues to focus on enhancing their core business and operational efficiency.

NerdWallet, Inc. Class A Financial Statement Overview

Summary
NerdWallet, Inc. shows strong revenue growth and improving profitability, with a robust balance sheet featuring substantial equity and no debt, minimizing financial risks. Cash flow generation is solid, supporting operational and strategic flexibility. Continued focus on margin expansion and strategic use of leverage could enhance growth prospects further.
Income Statement
85
Very Positive
NerdWallet, Inc. has demonstrated impressive revenue growth over the years, with a notable increase of 14.71% from 2023 to 2024. The gross profit margin is robust at 90.74% for 2024, indicating efficient cost management. However, the net profit margin has only recently turned positive at 4.42%, reflecting improved profitability but suggesting room for further margin expansion. The EBIT margin remains modest at 1.37%, indicating operational efficiency improvements are still underway.
Balance Sheet
75
Positive
The balance sheet is solid with a strong equity base, evidenced by an equity ratio of 83.25%. The company operates with no debt, which eliminates financial leverage risks. Return on Equity (ROE) has improved to 8.34% in 2024, showcasing enhanced profitability. Nevertheless, the low debt-to-equity ratio of 0.00 suggests limited leverage, which could be a strategic area for growth financing.
Cash Flow
80
Positive
Cash flows have improved significantly, with free cash flow growing by 67.14% from 2023 to 2024. The operating cash flow to net income ratio of 2.36 indicates strong cash generation relative to net income. The company maintains a healthy cash position with a free cash flow to net income ratio of 2.34, reflecting efficient cash utilization. However, the substantial negative financing cash flow in 2024 may indicate a strategic shift or repayment of obligations.
BreakdownTTMDec 2024Dec 2023Dec 2022Dec 2021Dec 2020
Income Statement
Total Revenue734.90M687.60M599.40M538.90M379.60M245.30M
Gross Profit667.40M624.10M545.40M499.10M351.10M224.00M
EBITDA51.20M54.10M55.30M19.50M-9.30M16.30M
Net Income29.50M30.40M-11.80M-10.20M-42.50M5.30M
Balance Sheet
Total Assets475.00M437.60M418.60M425.70M364.10M255.20M
Cash, Cash Equivalents and Short-Term Investments92.20M68.50M102.50M83.90M167.80M85.40M
Total Debt0.008.90M9.60M12.70M15.10M45.10M
Total Liabilities103.40M73.40M51.70M84.00M106.50M172.50M
Stockholders Equity371.60M364.20M366.90M341.70M257.60M82.70M
Cash Flow
Free Cash Flow55.30M71.20M42.60M-7.20M-15.80M-3.30M
Operating Cash Flow75.80M71.80M72.10M25.00M7.20M15.40M
Investing Cash Flow-20.80M-29.70M-29.50M-100.30M-23.00M-55.40M
Financing Cash Flow-74.00M-76.50M-26.20M-8.40M100.20M55.70M

NerdWallet, Inc. Class A Technical Analysis

Technical Analysis Sentiment
Positive
Last Price11.32
Price Trends
50DMA
10.57
Positive
100DMA
10.19
Positive
200DMA
11.85
Negative
Market Momentum
MACD
0.16
Negative
RSI
61.78
Neutral
STOCH
87.36
Negative
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For NRDS, the sentiment is Positive. The current price of 11.32 is above the 20-day moving average (MA) of 10.98, above the 50-day MA of 10.57, and below the 200-day MA of 11.85, indicating a neutral trend. The MACD of 0.16 indicates Negative momentum. The RSI at 61.78 is Neutral, neither overbought nor oversold. The STOCH value of 87.36 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for NRDS.

NerdWallet, Inc. Class A Risk Analysis

NerdWallet, Inc. Class A disclosed 56 risk factors in its most recent earnings report. NerdWallet, Inc. Class A 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

NerdWallet, Inc. Class A Peers Comparison

Overall Rating
UnderperformOutperform
Sector (61)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
78
Outperform
$2.94B13.6519.94%24.47%54.18%
69
Neutral
$843.48M28.757.86%24.20%
OMOMF
68
Neutral
$7.11B12.6517.46%6.96%9.07%
67
Neutral
$20.53B44.137.51%21.24%
67
Neutral
$20.53B44.137.51%21.24%
61
Neutral
$41.26B-0.79-14.19%3.78%2.39%-73.52%
55
Neutral
$7.02B-10.30%34.69%63.65%
55
Neutral
$7.02B-10.30%34.69%63.65%
LULU
52
Neutral
$2.41B-3.79%4.57%-38.81%-425.73%
* Communication Services Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
NRDS
NerdWallet, Inc. Class A
11.32
-3.96
-25.92%
OMF
OneMain Holdings
59.76
15.75
35.79%
ENVA
Enova International
115.85
54.36
88.40%
LU
Lufax Holding
2.79
0.25
9.84%
UPST
Upstart Holdings
73.82
50.60
217.92%
UPST
Upstart Holdings
73.82
50.60
217.92%
SOFI
SoFi Technologies
18.57
12.22
192.44%
SOFI
SoFi Technologies
18.57
12.22
192.44%

NerdWallet, Inc. Class A Corporate Events

Private Placements and FinancingBusiness Operations and Strategy
NerdWallet Amends Credit Agreement for Flexibility
Positive
Jun 18, 2025

On June 13, 2025, NerdWallet, Inc. amended its Credit Agreement with JPMorgan Chase Bank and a syndicate of lenders. The amendment allows certain subsidiaries to make acquisitions and permits the company to invest up to $20 million in unrestricted subsidiaries annually, enhancing operational flexibility.

The most recent analyst rating on (NRDS) stock is a Buy with a $18.00 price target. To see the full list of analyst forecasts on NerdWallet, Inc. Class A stock, see the NRDS Stock Forecast page.

Executive/Board ChangesBusiness Operations and Strategy
NerdWallet Approves Equity Awards for Chief Business Officer
Neutral
Jun 6, 2025

On June 3, 2025, NerdWallet’s Board of Directors’ Compensation Committee approved equity awards for Sam Yount, the Chief Business Officer, under the company’s 2021 Equity Incentive Plan. The awards include restricted stock units and options to purchase shares, with vesting schedules contingent on Mr. Yount’s continued service. Additionally, Mr. Yount was approved for participation in the company’s Change of Control and Severance Policy, indicating a strategic move to retain key leadership and align incentives with company performance.

The most recent analyst rating on (NRDS) stock is a Buy with a $16.00 price target. To see the full list of analyst forecasts on NerdWallet, Inc. Class A stock, see the NRDS Stock Forecast page.

Executive/Board ChangesShareholder Meetings
NerdWallet Appoints New Directors and Holds Annual Meeting
Neutral
May 22, 2025

On May 19, 2025, NerdWallet, Inc. appointed Anthony Ling as an independent director to its Board, effective May 22, 2025, filling the vacancy left by Maurice Taylor. Ling will also join the Audit Committee and receive compensation in line with the company’s updated non-employee director compensation policy. Additionally, Kenneth T. McBride was appointed as Lead Independent Director, effective May 22, 2025. The company held its 2025 Annual Meeting of Stockholders on May 21, 2025, where all director nominees were elected, and Deloitte & Touche LLP was ratified as the independent accounting firm for 2025. Amendments to the Non-Employee Director Compensation Policy were approved to align with market practices.

The most recent analyst rating on (NRDS) stock is a Buy with a $18.00 price target. To see the full list of analyst forecasts on NerdWallet, Inc. Class A stock, see the NRDS Stock Forecast page.

Business Operations and StrategyFinancial Disclosures
NerdWallet Reports Strong Q1 2025 Revenue Growth
Positive
May 6, 2025

On May 6, 2025, NerdWallet, Inc. reported its financial results for the first quarter ending March 31, 2025, with a revenue of $209.2 million, marking a 29% increase year-over-year. The growth was primarily driven by the insurance and banking sectors, with insurance revenue seeing a 246% rise due to increased auto insurance budgets. However, credit card revenue decreased by 24% due to ongoing challenges in organic search traffic. The company is focusing on long-term growth through operational efficiency and investments in vertical integration and user engagement.

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.Date of analysis: Jun 24, 2025