OPFI Stock Jumps 36% in a Year: Should You Hold or Fold Now?

Core Insights - OppFi Inc. (OPFI) shares have increased by 36.3% over the past year, outperforming the industry's decline of 7.9% and the Zacks S&P 500 Composite's growth of 18.4% [1][9] Financial Performance - In Q3 2025, OPFI's total net originations rose by 5.2% sequentially and 12.5% year over year, indicating a positive trend in revenue generation [5] - For the nine months ending September 30, 2025, the net charge-off as a percentage of total revenues decreased by 430 basis points, while the net charge-off as a percentage of average receivables fell by 480 basis points, reflecting improved loan quality [6] - Adjusted net income surged by 82.7% for the same nine-month period, leading management to raise the adjusted net income guidance for 2025 to a range of $137-$142 million from the previous estimate of $125-$130 million [7] Valuation Metrics - OPFI shares are trading at 6.04 times forward 12-month earnings per share, significantly lower than the industry average of 20.5 times [10] - The trailing 12-month EV-to-EBITDA ratio for OPFI is 5.07 times, compared to the industry average of 11.21 times, indicating that OPFI is undervalued [10] Revenue and Earnings Outlook - The Zacks Consensus Estimate for OPFI's 2025 revenues is $598 million, representing a year-over-year growth of 13.6% [13] - The consensus estimate for OPFI's 2025 earnings per share is $1.57, indicating a substantial year-over-year increase of 65.3% [13] Market Challenges - OPFI serves subprime/non-prime borrowers, which inherently increases the risk of credit defaults, with 28% of consumers in the 580-669 credit score range at risk of serious delinquency [14] - The company faces intense competition from firms like SoFi and Dave, which may impact its market share [15][16]