Green Dot Corporation (GDOT): Is It A Buy Now?

In the non Wal-Mart Stores, Inc. (NYSE:WMT) business, Green Dot Corporation (NYSE:GDOT) only saw 2% revenue growth as it faced continue competition from NetSpend Holdings Inc (NASDAQ:NTSP) along with the Chase, PayPal, Western Union, Blackhawk, and others including numerous celebrity options including Justin Bieber. All of the data suggests minimal impact with the company garnering a vast majority of new accounts. If anything, the decision to reject questionable customers at a much higher rate had a greater impact.

Considering Bluebird is only a very small division of American Express Company (NYSE:AXP), the results of that card can’t be as easily compared to Green Dot Corporation (NYSE:GDOT). NetSpend Holdings Inc (NASDAQ:NTSP) reported strong results for Q1 2013 as it took over the sole GPR card that can be ordered through the TurboTax software from Intuit. The company saw diluted earnings jump to $0.19 this quarter from $0.13 last year. Analysts expect Netspend revenue to surge 20% this year and another 15% next year to reach $484 million Green Dot could hit $580 million of revenue next year suggesting the $1.1 billion valuation for Netspend leaves a ton of upside for Green Dot Corporation (NYSE:GDOT).

With the pending purchase by Total System Services, Inc. (NYSE:TSS), the market will lose a direct competitor for comparative analysis purposes.

Conclusion

With NetSpend Holdings Inc (NASDAQ:NTSP) purchased for double the current valuation of Green Dot Corporation (NYSE:GDOT), the stock doesn’t appear over bought at these levels. While the company has faced several headwinds limiting growth for the year, the profit picture has remained strong and the balance sheet even more solid.

If Green Dot Corporation (NYSE:GDOT) can hit a home-run with the mobile bank, GoBank, this stock could be a huge winner as 2013 progresses.

The article Green Dot: Shaking Off the Competition originally appeared on Fool.com.

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