Tuesday, December 10, 2013

Seeking Alpha: After The Panic And Rally, Green Dot Still Has Plenty To Prove

Watching Green Dot (GDOT) from the cheap seats (ie, not as an actual shareholder) has been an interesting experience, as the market has moved through a pretty predictable cycle of excessive risk-blind optimism, near-blind panic, and relief. While that all has been going on, the market for prepaid debit cards has continued to develop and mature but still seems to be largely unpenetrated. At the same time, Green Dot has been rolling a range of services and distribution points that should give it a leg up in maintaining its position as the market leader.

At this point, I think Green Dot is in sight of fair value, but I'll be the first to acknowledge that there is a bigger than average range of potential outcomes here. I'm expecting Green Dot to generate mid-to-high single digit revenue and free cash flow growth, but the opportunity is larger than those numbers suggest and Green Dot could elbow out its competition. I could also see this company appealing to a range of companies in the payment foodchain, any one of which could use the fee income and customer base that Green Dot can offer.

Read more here:
After The Panic And Rally, Green Dot Still Has Plenty To Prove

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