Figure Gets Mixed Wall Street Debut as KBW, BofA Diverge on Outlook

Two large Wall Street concern banks person issued differing views connected the recently nationalist fintech steadfast Figure (FIGR), arsenic the institution works to grow its blockchain-based lending and superior markets level beyond location equity lines of credit.

Keefe, Bruyette & Woods (KBW) initiated sum of Figure with an “outperform” standing and a 12-month terms people of $48.50, suggesting 17.5% upside. The slope praised Figure’s aboriginal dominance successful tokenized recognition markets, wherever it holds 73% of the backstage recognition conception and 39% of each tokenized real-world assets, according to KBW’s estimates.

Founded by erstwhile SoFi CEO Mike Cagney, Figure went nationalist successful September and has climbed 12% since its IPO. Its halfway concern tokenizes HELOCs and connects borrowers to investors done a vertically integrated level that includes indebtedness origination, organisation and a integer plus marketplace.

KBW sees Figure’s tech stack arsenic underutilized and susceptible of supporting a wider scope of recognition assets, specified arsenic first-lien mortgages and idiosyncratic loans. It besides pointed to upside from products similar Figure Exchange and a tokenization instrumentality for third-party assets.

Another broker, Bernstein, earlier initiated sum connected the banal with a much upbeat outlook. It rates Figure arsenic an "outperform" with $54 terms target, citing that the steadfast is doing for lending what stablecoins did for payments, tokenizing accepted assets to marque markets faster and much efficient.

Read more: Figure Is a Blockchain Pioneer successful Credit Markets, Says Bernstein, Initiating astatine Outperform

The flipside

Bank of America, however, took a much cautious view.

It initiated sum with a “neutral” standing and a $41 terms target, citing risks astir execution, regularisation and Figure’s dependence connected its HELOC business, which inactive generates astir of its profits and is not yet afloat blockchain-native.

BofA sees Figure Connect — a caller marketplace that helps lenders lucifer with superior providers — arsenic the company’s adjacent maturation driver. The slope expects it to relationship for 75% of the firm’s full gross maturation betwixt 2024 and 2027.

While some banks acknowledged Figure’s enactment successful a neglected country of user lending, they diverged connected however easy the institution tin standard into a broader fintech platform. BofA cited imaginable roadblocks onboarding ample institutions, contention from different tech providers and changing regulatory rules, including updates to the Truth successful Lending Act.

The quality successful terms targets — $48.50 from KBW versus $41 from BofA — reflects the uncertainty surrounding whether Figure’s blockchain infrastructure tin modulation from a niche usage to a much cardinal relation successful modern finance.

Read more: Blockchain-Based Lender Figure Prices IPO astatine $25 Per Share, Raising Nearly $788M