An analyst from KeyBanc has revised the price target for NerdWallet (NRDS, Financial), reducing it from $18 to $14. Despite maintaining an Overweight rating on the stock, there are concerns about macroeconomic factors potentially affecting the company's revenue and profitability through 2025. Although projections indicate that NerdWallet's first-quarter performance may align with or surpass forecasts, the firm has adjusted its revenue predictions for 2025 and 2026, lowering them by 4% and 6%, respectively.
Despite these cautious adjustments due to broader economic challenges, KeyBanc remains optimistic about NerdWallet's potential for significant growth. The firm believes that the company is currently underperforming relative to its capacity and anticipates substantial expansion in both growth and profit margins once the economic conditions improve.
Wall Street Analysts Forecast
Based on the one-year price targets offered by 6 analysts, the average target price for Nerdwallet Inc (NRDS, Financial) is $16.00 with a high estimate of $19.00 and a low estimate of $11.00. The average target implies an upside of 76.21% from the current price of $9.08. More detailed estimate data can be found on the Nerdwallet Inc (NRDS) Forecast page.
Based on the consensus recommendation from 7 brokerage firms, Nerdwallet Inc's (NRDS, Financial) average brokerage recommendation is currently 2.0, indicating "Outperform" status. The rating scale ranges from 1 to 5, where 1 signifies Strong Buy, and 5 denotes Sell.
Based on GuruFocus estimates, the estimated GF Value for Nerdwallet Inc (NRDS, Financial) in one year is $15.64, suggesting a upside of 72.25% from the current price of $9.08. GF Value is GuruFocus' estimate of the fair value that the stock should be traded at. It is calculated based on the historical multiples the stock has traded at previously, as well as past business growth and the future estimates of the business' performance. More detailed data can be found on the Nerdwallet Inc (NRDS) Summary page.
NRDS Key Business Developments
Release Date: February 12, 2025
- Q4 Revenue: $184 million, up 37% year-over-year.
- Full Year Revenue: $688 million, a 15% increase versus prior year.
- Insurance Revenue: $72 million in Q4, growing 821% year-over-year.
- Credit Card Revenue: $35 million in Q4, declining 19% year-over-year.
- Loans Revenue: $18 million in Q4, declining 26% year-over-year.
- SMB Products Revenue: $26 million in Q4, declining 7% year-over-year.
- Emerging Verticals Revenue: $34 million in Q4, growing 7% year-over-year.
- Non-GAAP Operating Income: $16.8 million in Q4.
- Adjusted EBITDA: $31 million in Q4.
- GAAP Operating Income: $8.7 million in Q4.
- Net Income: $38.6 million in Q4, including a $37.9 million income tax benefit.
- Monthly Unique Users (MUUs): 19 million in Q4, down 20% year-over-year.
- Q1 2025 Revenue Guidance: $187 million to $193 million, a 17% increase at midpoint versus prior year.
- Q1 2025 Non-GAAP Operating Outlook: $3 million loss to breakeven.
- Full Year 2025 Non-GAAP Operating Income Guidance: $50 million to $60 million.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Nerdwallet Inc (NRDS, Financial) reported a 37% year-over-year revenue growth in Q4 2024, reaching $184 million.
- The insurance vertical experienced significant growth, with revenue increasing by 821% year-over-year in Q4.
- The company successfully launched new initiatives, such as NerdWallet Mortgage Experts and NerdWallet+, enhancing user engagement.
- Nerdwallet Inc (NRDS) achieved a full-year revenue of $688 million, marking a 15% increase compared to the previous year.
- The company is focusing on building direct, engaged relationships with consumers and SMBs, which is expected to drive long-term growth.
Negative Points
- The personal loans business saw a 51% year-over-year decline in Q4 2024.
- Monthly unique users (MUUs) decreased by 20% year-over-year in Q4, reflecting challenges in organic traffic growth.
- Credit card revenue declined by 19% year-over-year in Q4, with continued pressure expected in the near term.
- The company anticipates a challenging lending environment, impacting growth in certain verticals like SMB products.
- Nerdwallet Inc (NRDS) expects a $3 million loss to breakeven in Q1 2025 due to increased brand expenses and a shift in performance marketing mix.
