Dave (DAVE): Evaluating Valuation After Insider Selling and Analyst Downgrade

Dave (DAVE) shares were down 7.6% following both a wave of insider stock sales and a downgrade from a major ratings firm. These developments have caught the attention of investors who are tracking momentum and sentiment shifts in the digital banking sector.

See our latest analysis for Dave.

While Dave’s latest stumble, driven by insider selling and a notable ratings downgrade, has rattled the market, it comes after a stretch of exceptional growth. The 2024 year-to-date share price return still stands at 136.01%, while the total shareholder return over three years is a staggering 1,612.57%. Momentum may be fading in the near term, but that long-term track record keeps Dave on many investors’ radar.

If today’s headlines have you rethinking where momentum might strike next, consider broadening your search and check out fast growing stocks with high insider ownership.

With Dave trading at just over half of its average analyst price target, investors are left to wonder whether the recent pullback reflects a true value opportunity or if the market is already factoring in all potential growth. Is there still upside, or is Dave’s story fully priced in?

Most Popular Narrative: 33.5% Undervalued

With the most-followed narrative placing Dave’s fair value at $306.38 versus a last close of $203.70, the implied upside is sizeable. The narrative hinges on fundamental improvements and future product potential, setting the stage for an optimistic outlook.

Strong engagement from the gig economy and freelance workforce, combined with the proven durability of Dave's ExtraCash product for repeat liquidity needs, points toward sustained demand and revenue resilience as economic shifts continue to favor flexible, on-demand financial services.

Read the complete narrative.

Want to know the engine behind this bullish price target? The protagonist of this narrative is an ambitious financial model fueled by margin expansion and a revenue trajectory that might surprise you. Curious about the future profit assumptions that analysts are betting on? One blockbuster growth number, one sharply improved margin forecast, and a bold earnings multiple are at the core of this forecast. Find out which assumptions power that much headroom.

Result: Fair Value of $306.38 (UNDERVALUED)

Have a read of the narrative in full and understand what's behind the forecasts.

However, continued regulatory scrutiny on fee-based models, along with intensifying competition from larger fintechs, could quickly test this optimistic outlook for Dave.

Find out about the key risks to this Dave narrative.

Build Your Own Dave Narrative

If you want to take a hands-on approach or have your own perspective on Dave’s outlook, it takes just a few minutes to craft your own valuation and see where the numbers lead. Do it your way.

A great starting point for your Dave research is our analysis highlighting 3 key rewards and 1 important warning sign that could impact your investment decision.

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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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