DAVE Stock Soars 79% in a Year: Should Investors Buy It Now?

Core Insights - Dave Inc. (DAVE) stock has experienced significant growth, increasing by 78.5% over the past year, outperforming both the industry and the Zacks S&P 500 composite, which grew by 18.3% [1][7]. Group 1: Business Model and Customer Growth - In Q3 2025, DAVE added 843,000 members, demonstrating consistent growth across previous quarters, driven by a simplified fee model that includes a $0 transaction fee and a 5% fee structure capped at $15 [5][7]. - The CashAI v5.5 technology has been crucial for customer acquisition, contributing to a 20% increase in average ExtraCash size while maintaining high credit quality [6][7]. Group 2: Financial Performance and Margins - DAVE boasts a 30.6% EBITDA margin, significantly higher than competitors Upstart (6.9%) and Affirm (6.9%), indicating superior operational efficiency [7][8]. - The company has a trailing 12-month return on equity (ROE) of 77.8% and a return on invested capital (ROIC) of 48.8%, both exceeding industry averages [10][12]. Group 3: Liquidity and Valuation - As of September 2025, DAVE holds $92 million in cash reserves with no debt, resulting in a current ratio of 8.7, well above the industry average of 1.6 [12]. - The stock is currently valued at 12.7 times forward earnings per share, below the industry average of 22.8 times, presenting a value investment opportunity [13]. Group 4: Analyst Outlook - The Zacks Consensus Estimate for DAVE's 2026 revenues is $656.4 million, reflecting a 19.6% year-over-year growth, with EPS expected to rise by 8.6% to $14.07 [15]. - Recent upward revisions in EPS estimates indicate growing analyst confidence in the company's financial outlook [15].