William Blair analyst Dylan Becker has maintained their neutral stance on BLND stock, giving a Hold rating on April 30.
Dylan Becker has given his Hold rating due to a combination of factors including the slight outperformance of Blend Labs in the first quarter against Wall Street expectations, despite a general downturn in the mortgage sector which affected the company’s volume. The Blend Platform saw a moderate revenue decline, indicative of the broader challenges within the mortgage industry, particularly during a seasonally weaker first quarter. Despite these sector-wide challenges, Blend Labs managed to secure a significant deal in consumer banking and saw an increase in mortgage-related add-ons, enhancing revenue per funded loan.
Furthermore, management’s commentary suggested a strong pipeline with activity levels comparable to those in the more robust years of 2020 and 2021, hinting at potential growth in the second half of the year. This optimism is supported by large financial institutions’ growing digital transformation initiatives. The company’s disciplined approach to cost management is also steering it towards a non-GAAP operating breakeven by year’s end. While Becker acknowledges Blend Labs’ adept handling of the difficult mortgage environment and efforts to diversify revenue streams, he maintains a Hold rating, pending clearer signs of recovery in the mortgage market which remains central to the company’s business.
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Blend Labs (BLND) Company Description:
Blend Labs Inc is a cloud based platform. It supports and simplifies applications for mortgages, consumer loans, and deposit accounts.
