DAVE is Set to Report Q4 Earnings: Buy, Sell or Hold the Stock?

Core Insights - Dave Inc. (DAVE) is expected to report fourth-quarter 2025 results on March 2, with earnings per share (EPS) estimated at $3.5, reflecting a 71.6% increase year-over-year, and revenues projected at $164 million, indicating a 62.5% growth compared to the previous year [1][7] Earnings Performance - DAVE has a strong earnings surprise history, having exceeded the Zacks Consensus Estimate in the last four quarters with an average surprise of 74.7% [2] - The company currently has an Earnings ESP of +9.07% and holds a Zacks Rank of 1 (Strong Buy), suggesting a high likelihood of an earnings beat [4][3] Growth Drivers - DAVE's membership reached 843,000 in Q3 2025, driven by a customer-centric strategy and effective credit risk management through CashAI v5.5, which has improved monetization and retention rates [5][13] - The company reported a 49% year-over-year increase in ExtraCash origination in Q3 2025, contributing to a 63% rise in its top line [13][15] Stock Performance and Valuation - Over the past year, DAVE shares have increased by 66.5%, outperforming the industry average of 7% and the S&P 500's 20% gain [6][7] - DAVE trades at a trailing P/E ratio of 11.81X, significantly lower than the industry average of 21.95X, indicating an attractive valuation [9][18] Financial Health - As of September 2025, DAVE maintained a strong balance sheet with $92 million in cash and no current debt, resulting in a current ratio of 8.7, well above the industry average of 1.6 [16][15] - The company's return on equity (ROE) was 77.7%, far exceeding the industry average of 15.6%, and its return on invested capital (ROIC) was 48.8%, also above the industry average of 7.7% [15][18] Market Position - DAVE targets the underbanked population, capitalizing on the growing neobank market and the rise of mobile banking, positioning itself for significant market share growth [12]