UPDATE: Credit Suisse Initiates Outperform, $10.50 on NetSpend Holdings

Credit Suisse initiates its coverage on NetSpend Holdings

with an Outperform rating and a $10.50 price target as the company is seen as well-positioned, despite disappointing showing right out of the IPO. Credit Suisse says, "On the heels of disappointing shortly after its IPO, NetSpend saw its shares decline by ~37% in 2011. While management came up short on the forecasting, communication, and execution fronts, we still think the company is well positioned to take advantage of growth opportunities in the large alternative financial services market. Large Untapped Market: With over 60 million unbanked and underbanked adults in the United States, the prepaid market is large and underpenetrated. We estimate that NetSpend can grow core prepaid revenue in the high single to low double digits over the next several years. Reflecting inherent operating leverage, earnings will likely grow faster." NTSP closed at $8.34 per share on Wednesday.