OTC:CLPMF
READ THE FULL CLPMF RESEARCH REPORT
On January 30th, 2025, Clip Money (OTC:CLPMF) announced a partnership with Green Dot Corp. (NYSE:GDOT), to allow Clip Money customers and Green Dot customers to use Clip Money’s cash-in and cash-out services at Green Dot locations. Green Dot is a mobile bank that operates primarily through an app but can be accessed in person at more than 95,000 stores in the US. The Green Dot Network offers services in stores, supermarkets, and gas stations, including Walmart, Walgreens, 7-Eleven, Dollar Tree, Kroger, Food Lion Stop & Shop, and CVS. Ninety-six percent of the U.S. population lives within three miles of a Green Dot Network location.
The two plan to roll out services in the second half of 2025. One big box retailer in the Green Dot network will be the first to go live with its 4,000 stores, and Clip Money hopes to add another chain at the same time or shortly after. This will bring the total number of locations offering Clip Money services to over 7,000 if you add the Clip Boxes and NCR ATMs to the Green Dot 4,000.
The expectation is that Clip Money’s current customers who have stores not currently near a Clip Money box or ATM will start using Green Dot locations, and some Green Dot business customers will also use Clip Money services. Clip Money plans to sell directly to Green Dot’s larger customers and hopes to entice some of them to be resellers to their own business customers. Since Clip Boxes are located only in large malls, there is a huge amount of territory available to be serviced at nearby convenient Green Dot stores.
Since the announcement, the company has been approached by many new retailers and businesses that would now be able to use its services. Even banks are calling. They see a low-cost way to service their business customers in person without building a bank branch. We expect to see announcements of both new customers and new selling partnerships in the coming months.
Leveraging the Green Dot locations allows Clip Money to expand without any capital expenditures for equipment or the expense of rent and maintenance of boxes. Clip Money will also be sharing profits with Green Dot, so we expect lower gross margins on revenues but similar profitability overall.
As a result of this huge increase in locations, we now expect Clip Money to grow more rapidly than expected and are raising forecasts. Q4 is Clip Money’s biggest retail quarter of the year, and revenues increase with an increase in the number of deposits as well as the size of those deposits, although not proportionally. Some deposits will not reach the threshold to meet a higher fee. With all the new customers, stores, and deposit locations, we still expect Q4 up 100% sequentially. While we expect a drop off sequentially in Q1, it should not be as great as the drop off in the sales of its customers due to minimums. In contrast to last year, we expect the number of Clip boxes will increase, not decrease, in Q1 this year. Cip Money will be reporting Q4 at the end of March.
We are raising our 2025 revenue estimate to $6.4 million and initiating a 2026 revenue forecast of $13 million- a doubling of revenues. This raises our price target to $0.31 per share based on an EV/Sales ratio of 6.0 times.
SUBSCRIBE TO ZACKS SMALL CAP RESEARCH to receive our articles and reports emailed directly to you each morning. Please visit our website for additional information on Zacks SCR.
DISCLOSURE: Zacks SCR has received compensation from the issuer directly, from an investment manager, or from an investor relations consulting firm, engaged by the issuer, for providing research coverage for a period of no less than one year. Research articles, as seen here, are part of the service Zacks SCR provides and Zacks SCR receives quarterly payments totaling a maximum fee of up to $40,000 annually for these services provided to or regarding the issuer. Full Disclaimer HERE.
