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Oportun Financial Corp. (OPRT)
:OPRT
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Oportun Financial
(NASDAQ:OPRT)63Neutral
Positive Factors
Financial Performance
Oportun Financial reported a return to positive GAAP net income due to improving credit trends and operational cost-saving initiatives, leading to better bottom-line performance.
Negative Factors
Credit Volatility
The shares are seen as fairly valued at approximately 10 times the 2025 GAAP EPS estimate, with a primary roadblock being the company's history of credit volatility.
Leadership Uncertainty
The announcement of the CFO's retirement and the search for a replacement might bring uncertainty to the company's financial leadership.
Oportun Financial (OPRT) vs. S&P 500 (SPY)
Market Cap
$234.51M
Dividend YieldN/A
Average Volume (3M)687.17K
Price to Earnings (P/E)―
Beta (1Y)1.49
Revenue Growth-5.22%
EPS Growth60.29%
CountryUS
Employees2,465
SectorFinancial
Sector Strength93
IndustryCredit Finance
Share Statistics
EPS (TTM)-2.01
Shares Outstanding36,134,274
10 Day Avg. Volume553,004
30 Day Avg. Volume687,170
Financial Highlights & Ratios
PEG RatioN/A
Price to Book (P/B)N/A
Price to Sales (P/S)0.34
Price to Cash Flow (P/CF)0.60
P/FCF Ratio0.40
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
$8.33Price Target Upside23.41% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering4
Oportun Financial Business Overview & Revenue Model
Company DescriptionOportun Financial Corp. is a holding company, which engages in the provision of financial services for customers with credit invisibles. The firm offers small dollar, unsecured installment loans through its proprietary lending platform. The company was founded in August 2005 and is headquartered in San Carlos, CA.
How the Company Makes MoneyOportun Financial makes money primarily through the interest and fees charged on the personal loans it offers. These loans are typically unsecured and cater to individuals who may not qualify for traditional credit products due to their credit profiles. The company uses proprietary scoring models to determine the risk and pricing of its loan products, allowing it to provide credit access while managing risk effectively. Additionally, Oportun may earn revenue from partnerships and collaborations with other financial institutions or service providers, expanding its reach and product offerings to a broader customer base.
Oportun Financial Financial Statement Overview
Summary
Oportun Financial faces profitability challenges despite strong gross margins and positive cash flow management. The reduction in debt improves leverage, but negative net income and declining revenue present risks.Income Statement
Oportun Financial's income statement shows a decline in total revenue from $1,056 million in 2023 to $1,001 million in TTM (Trailing-Twelve-Months) 2024, indicating a negative revenue growth rate. The gross profit margin is notably high at 100.18%, but the net profit margin is negative at -7.85%, indicating ongoing profitability issues. The EBIT margin, though positive at 36.52%, is offset by a negative net income, highlighting challenges in covering expenses beyond operating income.50
Neutral
Balance Sheet
The balance sheet reveals a debt-to-equity ratio of 0.05 for TTM 2024, indicating low leverage, but this is primarily due to a significant reduction in total debt. The return on equity remains negative, aligning with the net income loss. The equity ratio is 10.97%, reflecting a modest proportion of equity in total assets, which suggests a moderate risk level in terms of financial stability.45
Neutral
Cash Flow
Cash flow analysis indicates a stable operating cash flow of $390 million in TTM 2024, with a free cash flow growth rate of 4.34% year over year. The operating cash flow to net income ratio is negative, due to negative net income, but free cash flow is strong, suggesting effective cash management despite profitability challenges.60
Neutral
| Breakdown | ||||
| Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|
| Income Statement | Total Revenue | |||
| 1.00B | 1.06B | 640.70M | 530.40M | 335.10M | Gross Profit |
| 1.00B | 1.06B | 640.70M | 530.40M | 335.10M | EBIT |
| 591.40M | -198.77M | 17.76M | 62.80M | -58.10M | EBITDA |
| 0.00 | -198.77M | 0.00 | 89.90M | -37.87M | Net Income Common Stockholders |
| -78.68M | -179.95M | -77.80M | 47.41M | -45.10M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | |||
| 59.97M | 91.19M | 98.82M | 131.00M | 136.20M | Total Assets |
| 3.23B | 3.41B | 3.61B | 2.95B | 2.01B | Total Debt |
| 18.20M | 2.94B | 2.97B | 2.21B | 1.46B | Net Debt |
| -41.77M | 2.85B | 2.87B | 2.08B | 1.33B | Total Liabilities |
| 2.87B | 3.01B | 3.07B | 2.34B | 1.54B | Stockholders Equity |
| 353.81M | 404.40M | 547.60M | 603.80M | 466.30M |
| Cash Flow | Free Cash Flow | |||
| 374.33M | 361.50M | 199.00M | 136.90M | 126.30M | Operating Cash Flow |
| 393.52M | 392.76M | 247.90M | 163.40M | 152.90M | Investing Cash Flow |
| -193.69M | -286.18M | -1.17B | -884.80M | 16.40M | Financing Cash Flow |
| -191.22M | -104.39M | 934.50M | 745.70M | -136.80M |
Oportun Financial Technical Analysis
Positive
6.75
Price Trends
5.12
Positive
4.14
Positive
3.55
Positive
Market Momentum
0.56
Positive
56.35
Neutral
18.09
Positive
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For OPRT, the sentiment is Positive. The current price of 6.75 is below the 20-day moving average (MA) of 6.81, above the 50-day MA of 5.12, and above the 200-day MA of 3.55, indicating a neutral trend. The MACD of 0.56 indicates Positive momentum. The RSI at 56.35 is Neutral, neither overbought nor oversold. The STOCH value of 18.09 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for OPRT.
Oportun Financial Risk Analysis
Oportun Financial disclosed 69 risk factors in its most recent earnings report. Oportun 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
Oportun Financial Peers Comparison
Overall Rating
UnderperformOutperform
Sector (64)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
81 Outperform | $723.97M | 8.98 | 19.28% | ― | -2.78% | 24.39% | |
75 Outperform | $309.49M | 7.60 | 12.14% | 3.81% | 6.73% | 151.08% | |
74 Outperform | $2.46B | 12.96 | 17.19% | ― | 25.51% | 36.96% | |
73 Outperform | $806.10M | 64.47 | 31.53% | ― | 4.80% | -30.38% | |
64 Neutral | $14.34B | 10.61 | 9.28% | 4.07% | 18.04% | -9.54% | |
63 Neutral | $234.51M | ― | -20.76% | ― | -5.22% | 60.29% | |
53 Neutral | $1.33B | 26.06 | 3.96% | ― | 3.63% | 27.77% |
* Financial Sector Average
Performance Comparison
OPRT
Oportun Financial
6.75
3.14
86.98%
RM
Regional Management
32.23
10.05
45.31%
WRLD
World Acceptance
126.85
-2.69
-2.08%
LC
LendingClub
11.85
3.85
48.12%
ENVA
Enova International
96.41
33.32
52.81%
OPFI
OppFi
10.36
6.73
185.40%
Oportun Financial Earnings Call Summary
Earnings Call Date: Feb 12, 2025 | % Change Since: 14.21% | Next Earnings Date: May 12, 2025
Earnings Call Sentiment Positive
The earnings call reflected a positive sentiment with significant improvements in profitability, credit performance, and cost management. While there were some revenue declines and one-time financial impacts, the overall outlook for 2025 is optimistic, with expectations for continued profitability and growth.Highlights
Return to GAAP Profitability
Oportun reported a GAAP net income of $9 million for Q4 2024, a $51 million improvement year-over-year, achieving a quarterly GAAP ROE of 10%.
Strong Originations Growth
Q4 2024 originations were $522 million, marking a 19% year-over-year growth, with a 23% increase in the number of loans originated.
Improved Credit Performance
The net charge-off rate improved by 55 basis points year-over-year to 11.7%, the lowest level since Q3 2022.
Expense Reduction
Operating expenses were reduced by 31% year-over-year, coming in at $89 million, the lowest since Q2 2019.
Adjusted EPS and EBITDA Growth
Adjusted EPS of $0.49 showed a significant increase from the previous year, and adjusted EBITDA grew by 315% year-over-year to $41 million.
Lowlights
Decline in Total Revenue
Total revenue for Q4 was $251 million, a 4% decline year-over-year, attributed to a reduced average daily principal balance and prior credit tightening actions.
One-time Write-off Impact
Q4 interest expense increased by $22 million year-over-year due to a one-time $17 million non-cash write-off of deferred financing costs.
Company Guidance
During the fourth quarter 2024 earnings call, Oportun Financial provided a comprehensive overview of its financial performance and offered guidance for the upcoming year. The company reported a return to GAAP profitability with a net income of $9 million and an adjusted ROE of 25%, reflecting a $30 million year-over-year improvement in adjusted net income. Originations grew by 19% year-over-year, totaling $522 million, while operating expenses were reduced by 31% to $89 million. The net charge-off rate improved by 55 basis points to 11.7%, and 30-plus day delinquencies decreased by 113 basis points to 4.8%. Looking ahead to 2025, Oportun projects total revenue between $945 million and $970 million, an annualized net charge-off rate of 11.5%, and adjusted EPS between $1.10 and $1.30, a significant increase from 2024's $0.72. The company aims to achieve an adjusted ROE in the teens, driven by 10% to 15% growth in originations and a 5% reduction in operating expenses.Oportun Financial Corporate Events
Executive/Board ChangesBusiness Operations and StrategyFinancial Disclosures
Oportun Financial Announces CFO Transition Amid Strong Results
Positive
Feb 12, 2025
Oportun Financial Corporation announced that its Chief Financial Officer, Jonathan Coblentz, will retire on March 28, 2025, with Casey Mueller stepping in as interim CFO. This leadership transition comes as Oportun reports its financial results for the fourth quarter and full year of 2024, highlighting a return to GAAP profitability with a net income of $9 million in the fourth quarter and a significant increase in adjusted EBITDA by 315% year-over-year. The company is raising its expectations for 2025, showcasing its strategic advancement and improved operational outcomes.
Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.
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.