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Why Is Green Dot (GDOT) Up 14.3% Since Last Earnings Report?
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A month has gone by since the last earnings report for Green Dot (GDOT - Free Report) . Shares have added about 14.3% in that time frame, outperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is Green Dot due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important drivers.
Green Dot Surpasses Q1 Earnings & Revenue Estimates
Green Dot reported solid first-quarter 2020 results, with earnings and revenues beating the Zacks Consensus Estimate.
Adjusted earnings of $1.13 beat the consensus estimate by 20.2% but declined 25.2% year over year. Non-GAAP operating revenues of $346.5 million surpassed the consensus mark by 8.5% and improved 6.4% year over year.
Segmental Revenues
The Account Services segment’s non-GAAP operating revenues came in at $233.3 million, up 2.2% from the year-ago quarter owing to a rise in BaaS program management service fee revenues earned from platform partners and increase in the number of direct deposit active accounts from BaaS and PayCard programs. This increase was partially offset by a decline in the number of active accounts in Consumer programs.
The Processing and Settlement Services segment’s non-GAAP operating revenues of $122 million grew 13.8% from the year-ago quarter, driven by robust performance in both tax processing and money processing services.
Key Metrics
Gross dollar volume climbed 10.1% year over year to $14.3 billion. Gross dollar volume from direct deposit sources increased 4.3% year over year to $10.7 million. Purchase volume also inched up 1% from the prior-year quarter to $8.3 billion. The company ended the first quarter with 5.7 million active accounts (down 5.1%) and 12.1 million cash transfers (up 10.5% year over year). The number of tax refunds processed was 9.7 million, up 3.3% year over year.
Operating Results
Adjusted EBITDA of $92.1 million decreased 22.6% on a year-over-year basis. Adjusted EBITDA margin of 26.6% also slid from the year-ago quarter’s 36.5%.
Balance Sheet
Green Dot exited the first quarter with cash, cash equivalents and restricted cash balance of $1.56 billion compared with the $1.06 billion witnessed at the end of the prior quarter. The company had no long-term debt.
The company generated $104.1 million of cash from operating activities and capex was $15.7 million.
How Have Estimates Been Moving Since Then?
It turns out, fresh estimates have trended downward during the past month. The consensus estimate has shifted -45.64% due to these changes.
VGM Scores
At this time, Green Dot has a subpar Growth Score of D, though it is lagging a bit on the Momentum Score front with an F. However, the stock was allocated a grade of A on the value side, putting it in the top quintile for this investment strategy.
Overall, the stock has an aggregate VGM Score of C. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been broadly trending downward for the stock, and the magnitude of these revisions indicates a downward shift. Notably, Green Dot has a Zacks Rank #2 (Buy). We expect an above average return from the stock in the next few months.
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Why Is Green Dot (GDOT) Up 14.3% Since Last Earnings Report?
A month has gone by since the last earnings report for Green Dot (GDOT - Free Report) . Shares have added about 14.3% in that time frame, outperforming the S&P 500.
Will the recent positive trend continue leading up to its next earnings release, or is Green Dot due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at the most recent earnings report in order to get a better handle on the important drivers.
Green Dot Surpasses Q1 Earnings & Revenue Estimates
Green Dot reported solid first-quarter 2020 results, with earnings and revenues beating the Zacks Consensus Estimate.
Adjusted earnings of $1.13 beat the consensus estimate by 20.2% but declined 25.2% year over year. Non-GAAP operating revenues of $346.5 million surpassed the consensus mark by 8.5% and improved 6.4% year over year.
Segmental Revenues
The Account Services segment’s non-GAAP operating revenues came in at $233.3 million, up 2.2% from the year-ago quarter owing to a rise in BaaS program management service fee revenues earned from platform partners and increase in the number of direct deposit active accounts from BaaS and PayCard programs. This increase was partially offset by a decline in the number of active accounts in Consumer programs.
The Processing and Settlement Services segment’s non-GAAP operating revenues of $122 million grew 13.8% from the year-ago quarter, driven by robust performance in both tax processing and money processing services.
Key Metrics
Gross dollar volume climbed 10.1% year over year to $14.3 billion. Gross dollar volume from direct deposit sources increased 4.3% year over year to $10.7 million. Purchase volume also inched up 1% from the prior-year quarter to $8.3 billion. The company ended the first quarter with 5.7 million active accounts (down 5.1%) and 12.1 million cash transfers (up 10.5% year over year). The number of tax refunds processed was 9.7 million, up 3.3% year over year.
Operating Results
Adjusted EBITDA of $92.1 million decreased 22.6% on a year-over-year basis. Adjusted EBITDA margin of 26.6% also slid from the year-ago quarter’s 36.5%.
Balance Sheet
Green Dot exited the first quarter with cash, cash equivalents and restricted cash balance of $1.56 billion compared with the $1.06 billion witnessed at the end of the prior quarter. The company had no long-term debt.
The company generated $104.1 million of cash from operating activities and capex was $15.7 million.
How Have Estimates Been Moving Since Then?
It turns out, fresh estimates have trended downward during the past month. The consensus estimate has shifted -45.64% due to these changes.
VGM Scores
At this time, Green Dot has a subpar Growth Score of D, though it is lagging a bit on the Momentum Score front with an F. However, the stock was allocated a grade of A on the value side, putting it in the top quintile for this investment strategy.
Overall, the stock has an aggregate VGM Score of C. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been broadly trending downward for the stock, and the magnitude of these revisions indicates a downward shift. Notably, Green Dot has a Zacks Rank #2 (Buy). We expect an above average return from the stock in the next few months.