Small-Cap Focus: Digital Bank Dave (DAVE) Offers Shareholders Big Returns

Digital banking service Dave (DAVE) is a small-cap stock that is delivering big returns to shareholders.

Founded in 2016, Dave is an online bank that focuses on providing short-term loans, mostly cash advances, to consumers. The company also has a service for finding people work called “SideHustle.” Dave is unique in that its doesn’t charge interest or origination fees. Instead, the company charges users a monthly service fee and provides an option to “tip” the company.

The approach might seem unorthodox but it is paying off for investors who have taken a position in DAVE stock. Over the last 12 months, Dave’s share price has risen a staggering 720%, crushing just about every other security listed on the Nasdaq exchange. At the start of 2024, DAVE stock was trading at less than $8 per share. By December, it was at nearly $110 a share.

Growing User Base

Dave got a break when famed investor and Shark Tank personality Mark Cuban led a $3 million investment round in the company. Since then, Dave has received more than $180 million in venture funding. The company went public on the Nasdaq exchange via a special purpose acquisition company (SPAC) in January 2022.

Today, Dave has a market capitalization of just over $1 billion, making it small-cap stock defined as any security that trades for less than $5 billion to $10 billion. As the company’s user base has steadily grown and surpassed 10 million app downloads, its share price has soared. Despite the big run, many analysts remain bullish on DAVE stock.

Is DAVE Stock a Buy?

The stock of Dave has a consensus Strong Buy rating among seven Wall Street analysts. That rating is based on seven Buy recommendations issued in the last 12 months. There are no Hold or Sell ratings on the stock currently. The average DAVE price target of $104.67 implies 26.55% upside from current levels.

Read more analyst ratings on DAVE stock