Citigroup: Green Dot's Good News May Be Priced In

After going about a consolidation move for much of 2016, Green Dot Corporation GDOT shares took off strongly in 2017.

The Analyst

Citigroup analyst Ashwin Shirvaikar downgraded his rating on Green Dot from Buy to Neutral and upped his price target from $54 to $66.

The Thesis

Many of the factors that supported Citi's January upgrade of Green Dot have played out by now, making comparisons tougher in 2018, Shirvaikar said in a Monday note. (See Shirvaikar's track record here.)

Pointing to some recent wins, including from Uber, Apple Inc. AAPL Pay Cash and Intuit Inc. INTU, analyst Shirvaikar said some of them have a slow revenue ramp and expenses loaded on the front end. 

Therefore, Shirvaikar expects fewer chances of material earnings beat-and-raise quarters that drove Green Dot's stock performance in 2017.

Given its view on ramp and costs, Citi adjusted its earnings per share estimates for 2018 slightly below the mid-point of its low and high scenario outcomes, which are at $2.35 per share and $2.61 per share, respectively.

"Clearly 2018-19 GDOT opportunities exist but they stem from less controllable factors and we are past the self-help phase," Shirvaikar said.

The Price Action

The shares of Green Dot have been up a whopping 171.1 percent year-to-date. 

Related Links: 

Lightning Round: Jim Cramer Give His Opinion On American Express, CME Group And More

What is The 'Prepaid Card Rule,' And Why is Congress Likely To Disapprove It?