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NerdWallet - AI Stock Analysis
Analysis generated May 20, 2024
NerdWallet, Inc. (NRDS) is a personal finance company dedicated to providing individuals clarity around financial decisions through a range of content and tools. Known for actionable insights tailored to diverse financial needs, NerdWallet covers everything from credit cards and banking, to loans and insurance, solidifying its position as a trusted online resource in the financial domain.
Fundamental Analysis
Revenue: For the last quarter, NerdWallet reported revenue of $162 million, representing a 21.12% increase from the previous quarter. This growth indicates that the company is effectively scaling its operations quarter-over-quarter. However, compared to the same quarter last year, there is a 4.55% decline, which may raise concerns regarding long-term sustainability.
Net Income: The net income for the last quarter stands at $1.1 million, reflecting a staggering 147.83% growth from the previous quarter. This boost underscores substantial operational improvements or better cost management. Yet, when juxtaposed with the same period last year, there is a 35.29% decline, flagging potential issues in maintaining profit margins.
EBITDA: For the current quarter, EBITDA was reported as $0, a concerning reduction of 100.00% from both the previous quarter and the same quarter last year. This significant decline indicates the company is struggling to maintain its earnings before interest, taxes, depreciation, and amortization.
PE Ratio: NerdWallet’s current Price-to-Earnings (P/E) ratio stands at 816. This extremely high P/E ratio could suggest that the stock is overvalued, leading to a potentially bearish outlook among value investors.
Technical Analysis
Stock Price: Currently, the stock price is $13.91, reflecting an increase of 4.51% from a month ago and a striking 46.27% rise compared to a year ago. These figures suggest a robust bullish trend in both the short-term and long-term perspectives.
SMA (Simple Moving Average): The current SMA10 is 13.82, marginally higher than the previous SMA10 of 13.81. This uptick indicates a potential upward trajectory in the stock’s price movement.
RSI (Relative Strength Index): With a current RSI of 64.6, the stock is in a neutral condition, neither overbought nor oversold. It indicates that there is room for potential gains without the immediate risk of a significant downward correction.
Alternative Data Analysis
Job Postings & Employee Sentiment: NerdWallet has 10 open positions, an increase of 25% in recent months. This suggests a focus on growth and expansion, a typically healthy sign. Nonetheless, the employee sentiment remains neutral.
Customer Acquisition: The site garners around 39 million visitors, though this is down by 20% over the last couple of months, hinting at a potential loss in customer interest. However, the daily app downloads stand at 2,600, an impressive rise of 11%, signifying successful engagement via mobile platforms.
Customer Engagement: NerdWallet has 130,000 followers on Instagram, up by 7%, indicating growing interest. The Twitter handle has 70,000 followers with no significant change, depicting stability in social media engagement.
AltIndex AI Score: NerdWallet's AI score stands at 69, which is interpreted as a buy signal, reflecting favorable conditions combining fundamental, technical, and alternative data.
Conclusion and Recommendation
NerdWallet displays mixed signals across different analysis metrics. The robust quarterly revenue growth and net income improvement from the previous quarter are encouraging, despite year-over-year declines and a concerning EBITDA. The stock’s technical indicators signal bullish trends, reinforcing a positive short-term and long-term outlook. Alternative data yields promising signs of growth and engagement, though the decline in web traffic is worrisome.
Given the high P/E ratio and mixed fundamental performance, caution is warranted. However, the bullish technical indicators and positive AI score provide a counterbalance. Thus, the recommendation leans slightly towards a “buy”, particularly for investors with a higher risk appetite and a focus on long-term growth potential.
Disclaimer: This AI stock analysis, generated by an experimental AI tool, is for informational purposes only and not financial advice. Information is based on publicly available data and may not always be accurate or current.
