Chime (CHYM): Has the Recent 25% Rebound Left the Fintech Stock Overvalued?

Chime Financial (CHYM) has quietly beaten the broader fintech space over the past month, with the stock up roughly 25% even as its year to date return remains down almost 29%.

See our latest analysis for Chime Financial.

The recent 30 day share price return of 24.65 percent, including a 9.10 percent jump in the last session to 26.50 dollars, suggests momentum is rebuilding even though the year to date share price return remains firmly negative.

If Chime’s rebound has you rethinking the fintech space, it could be a good moment to explore other high growth tech and AI stocks that are starting to show similar momentum shifts.

With revenue still growing double digits but profits deep in the red, and shares trading below analyst targets, is Chime an underappreciated turnaround story, or is the market already pricing in every bit of its future growth?

Price-to-Sales of 4.8x: Is it justified?

At a last close of 26.50 dollars, Chime trades on a premium price-to-sales multiple that suggests investors are already paying up for future growth.

The price-to-sales ratio compares the company’s market value to its annual revenue, a common yardstick for high-growth or unprofitable fintech names where earnings are not yet a reliable guide.

For Chime, the current price-to-sales multiple of 4.8 times looks stretched against both its estimated fair price-to-sales ratio of 4.5 times and the peer averages. This implies the market is assigning a richer growth and profitability trajectory than the historical record currently supports.

That premium stands out even more against the broader US diversified financials space, where the industry average sits near 2.5 times sales and direct peers cluster closer to 3.6 times. This underlines how much extra investors are willing to pay for Chime’s story today.

Explore the SWS fair ratio for Chime Financial

Result: Price-to-Sales of 4.8x (OVERVALUED)

However, persistent losses and any slowdown in revenue growth could quickly deflate sentiment, especially if analyst expectations or price targets begin to drift lower.

Find out about the key risks to this Chime Financial narrative.

Build Your Own Chime Financial Narrative

If this perspective does not fully align with your own, or you would rather dig into the numbers yourself, you can build a complete view in just a few minutes, Do it your way.

A good starting point is our analysis highlighting 2 key rewards investors are optimistic about regarding Chime Financial.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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