NerdWallet (NASDAQ:NRDS) Shares Gap Down Following Analyst Downgrade

Key Points

• Morgan Stanley downgraded NerdWallet from equal weight to underweight and cut its price target to $9, prompting a gap down in the stock (closed $10.36, opened $9.74).
• NerdWallet beat Q4 estimates with $0.19 EPS (vs. $0.17) and $225.4M revenue (vs. $211.4M), with revenue up 22.6% year‑over‑year, and the board authorized a $50 million share repurchase (up to 5% of shares).
• CAO Nicholas Tatum sold 10,151 shares at $11.45 (a 17.7% reduction in his holding), and insiders collectively own a high 46.54% of the company’s stock.

NerdWallet, Inc. (NASDAQ:NRDS - Get Free Report)'s share price gapped down prior to trading on Friday after Morgan Stanley downgraded the stock from an equal weight rating to an underweight rating. The stock had previously closed at $10.36, but opened at $9.74. Morgan Stanley now has a $9.00 price target on the stock, down from their previous price target of $14.00. NerdWallet shares last traded at $10.1080, with a volume of 300,498 shares changing hands.

A number of other brokerages have also recently issued reports on NRDS. Oppenheimer reduced their price objective on NerdWallet from $18.00 to $15.00 and set an "outperform" rating for the company in a report on Wednesday, March 4th. Zacks Research cut NerdWallet from a "hold" rating to a "strong sell" rating in a report on Thursday, February 26th. Finally, Truist Financial reduced their price target on NerdWallet from $19.00 to $18.00 and set a "buy" rating for the company in a research note on Thursday, February 26th. Four investment analysts have rated the stock with a Buy rating, two have given a Hold rating and two have issued a Sell rating to the stock. According to MarketBeat.com, the stock has a consensus rating of "Hold" and a consensus price target of $14.33.

Insider Transactions at NerdWallet

In related news, CAO Nicholas Tatum sold 10,151 shares of the stock in a transaction that occurred on Thursday, March 5th. The stock was sold at an average price of $11.45, for a total transaction of $116,228.95. Following the sale, the chief accounting officer owned 47,202 shares of the company's stock, valued at $540,462.90. This represents a 17.70% decrease in their ownership of the stock. The sale was disclosed in a filing with the SEC, which is available through the SEC website. 46.54% of the stock is owned by corporate insiders.

Institutional Trading of NerdWallet

Several large investors have recently modified their holdings of the stock. Vanguard Group Inc. increased its position in shares of NerdWallet by 1.2% in the third quarter. Vanguard Group Inc. now owns 3,994,180 shares of the company's stock worth $42,977,000 after purchasing an additional 48,205 shares during the period. Dimensional Fund Advisors LP lifted its position in NerdWallet by 4.9% during the fourth quarter. Dimensional Fund Advisors LP now owns 1,169,058 shares of the company's stock worth $15,842,000 after purchasing an additional 55,003 shares during the period. Arrowstreet Capital Limited Partnership grew its stake in NerdWallet by 26.1% during the third quarter. Arrowstreet Capital Limited Partnership now owns 1,133,790 shares of the company's stock worth $12,200,000 after buying an additional 234,691 shares in the last quarter. Geode Capital Management LLC grew its stake in NerdWallet by 9.7% during the second quarter. Geode Capital Management LLC now owns 925,503 shares of the company's stock worth $10,154,000 after buying an additional 81,986 shares in the last quarter. Finally, State Street Corp increased its holdings in NerdWallet by 3.2% in the 4th quarter. State Street Corp now owns 922,142 shares of the company's stock valued at $12,495,000 after buying an additional 28,844 shares during the period. 38.81% of the stock is owned by institutional investors and hedge funds.

NerdWallet Stock Performance

The firm's fifty day simple moving average is $11.53 and its 200 day simple moving average is $12.13. The stock has a market capitalization of $666.63 million, a P/E ratio of 15.59 and a beta of 1.44.

NerdWallet (NASDAQ:NRDS - Get Free Report) last issued its quarterly earnings results on Wednesday, February 25th. The company reported $0.19 earnings per share for the quarter, topping analysts' consensus estimates of $0.17 by $0.02. The company had revenue of $225.40 million during the quarter, compared to the consensus estimate of $211.37 million. NerdWallet had a net margin of 5.82% and a return on equity of 12.66%. The firm's quarterly revenue was up 22.6% on a year-over-year basis. During the same quarter in the prior year, the firm posted $0.51 EPS. Analysts anticipate that NerdWallet, Inc. will post 0.36 earnings per share for the current fiscal year.

NerdWallet announced that its board has authorized a stock repurchase program on Tuesday, December 16th that allows the company to buyback $50.00 million in shares. This buyback authorization allows the company to repurchase up to 5% of its stock through open market purchases. Stock buyback programs are typically a sign that the company's board of directors believes its shares are undervalued.

NerdWallet Company Profile

NerdWallet NASDAQ: NRDS is a personal finance company that offers independent guidance and comparison tools to help consumers make informed financial decisions. Through its website and mobile application, NerdWallet provides a wide range of content, including articles, calculators and reviews covering credit cards, mortgages, personal loans, banking products, investing, insurance and taxes. The platform aggregates partner offers to enable side-by-side comparisons, while editorially maintaining objectivity to support users in identifying the products that best suit their individual needs.

Founded in 2009 by Tim Chen and Jacob Gibson, NerdWallet is headquartered in San Francisco and serves consumers primarily in the United States, with additional localized offerings in Canada and the United Kingdom.

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