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Investing.com - Seaport Global Securities initiated coverage on Chime Financial (NASDAQ:CHYM) with a Buy rating and a price target of $37.00 on Monday. The stock, currently trading at $33.06, has shown strong momentum with an 11% gain over the past week, though InvestingPro data indicates it’s trading in overbought territory.
The research firm cited Chime’s strong brand, significant market opportunity with less than 5% penetration, and potential to deepen customer relationships as key factors supporting its positive outlook.
Seaport Global projects Chime will grow its revenue at an annual rate in the high 20% to low 30% range over the next two years, positioning the company for continued expansion.
The firm also highlighted Chime’s opportunity to improve profitability and margin profile as it scales further, expecting these factors to drive an eventual rerating of the stock.
The $37 price target is based on 5.5 times the company’s estimated 2026 enterprise value to sales ratio, according to Seaport Global Securities.
In other recent news, financial technology company Chime successfully raised $864 million in its initial public offering, with shares priced at $27 each. This pricing exceeded the anticipated range of $24 to $26 per share. The IPO values Chime at approximately $11.6 billion on a fully diluted basis, marking it as one of the largest public offerings by a U.S. fintech firm in recent years. Chime’s public debut comes amid a period of valuation adjustments for fintech companies that saw significant growth during the pandemic. Founded in 2012, Chime partners with traditional banks to offer financial services, including checking accounts with features like fee-free overdrafts. The company’s valuation has notably decreased from the $25 billion it reached during its last major funding round in 2021. Chime’s investor base includes notable firms such as DST Global, General Atlantic, and ICONIQ. The company is set to begin trading on the Nasdaq Global Select Market under the ticker symbol ’CHYM’.
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