BofA update shows where active managers are putting money
Investing.com - UBS initiated coverage on Chime Financial (NASDAQ:CHYM) with a Neutral rating and a $35.00 price target on Monday. According to InvestingPro data, the stock currently trades at $31.32, with analysts’ targets ranging from $33 to $37.
The financial services firm views Chime as a leading digital financial services platform focused on providing banking services to everyday Americans, particularly those earning less than $100,000 annually.
UBS highlighted Chime’s strategy of avoiding punitive fees such as overdraft charges, minimum balance requirements, and monthly fees, positioning the company on a path toward increased scale and profitability.
Through partnerships with FDIC-insured banks, Chime generates recurring revenue streams largely based on non-discretionary spending, according to UBS’s analysis.
The investment bank forecasts Chime will grow its transaction profit at approximately 18% compound annual growth rate through 2028 as it pursues an $86 billion-plus annual revenue opportunity and continues to scale primary account relationships.
In other recent news, Chime Financial successfully raised $864 million through its initial public offering, with shares priced at $27 each, surpassing the initially marketed range of $24 to $26 per share. This IPO values the company at approximately $11.6 billion on a fully diluted basis, marking it as one of the largest public offerings by a U.S. financial technology firm in recent years. The company’s valuation has decreased from the $25 billion it achieved during its last major funding round in 2021. In another development, Seaport Global Securities has initiated coverage on Chime Financial with a Buy rating and set a price target of $37.00. The research firm emphasized Chime’s strong brand and significant market opportunity, projecting revenue growth in the high 20% to low 30% range over the next two years. Seaport Global also highlighted the potential for Chime to improve its profitability and margin profile as it continues to scale. These developments underscore Chime’s strategic positioning and growth potential in the financial technology sector.
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