OppFi's Monster Q1 And Guidance Shockwave: Strong Buy Confirmed

Summary

• I maintain a "Strong Buy" rating on OppFi Inc. due to rising operating leverage, expansive margin growth, and improved unit economics, despite a recent stock correction.
• OppFi's Q1 FY2025 results exceeded expectations, with record revenues of $140.3 million (+10.1% YoY) and adjusted net income soaring by 285.1% YoY to $33.8 million.
• The company's raised FY2025 guidance, with adjusted net income now expected at $106-113 million, supports my bullish stance and suggests significant upside potential.
• Despite a pre-market jump, OPFI stock's valuation remains attractive (forward P/E ~8.64x), with a potential upside of 46–68% based on peer multiples.
• Reiterating Strong Buy rating: Q1 strength and guidance uplift outweigh macro concerns and GAAP warrant liability noise, highlighting significant undervaluation.

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Analyst’s Disclosure:I/we have a beneficial long position in the shares of OPFI either through stock ownership, options, or other derivatives. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.