Bernstein, a research and brokerage house, has started tracking Figure Technology Solutions, giving it a rating of “outperform” and predicting its stock will reach $54.
The firm believes Figure is pioneering the use of blockchain technology to modernize capital markets for conventional assets. Bernstein argues that Figure’s comprehensive system, including a system for creating loans, blockchain-based tokenization through Provenance, and a marketplace for trading tokenized credit, has the potential to support a wider variety of tokenized assets, including stocks and other real-world items.
In a client note released Monday, analysts headed by Gautam Chhugani pointed out Figure’s leading role in the tokenization of credit using blockchain, estimating that it controls approximately 75% of the $17 billion market for tokenized loans, and its capacity to revolutionize traditional lending practices.
“Just as stablecoins digitize the dollar and facilitate immediate payments without needing a central party, tokenized loans digitize and remove intermediaries from the lending process,” they stated.
Currently, roughly $33 billion in Real-World Assets (RWAs), excluding stablecoins, are tokenized on blockchains, primarily through private credit initiatives. Image courtesy of Bernstein.
According to Bernstein, Figure’s technology links consumer loans with the fluidity of blockchain-based capital markets, shifting a lending model that relies heavily on balance sheets to a marketplace approach that uses less capital. This transformation can cut operational expenses by more than 90% and shorten loan processing times by about 75%. The firm estimates Figure’s worth at approximately 26 times its projected EBITDA for 2027 and 40 times its future earnings, suggesting a potential increase of 34% from its closing price of $40.30 on Friday.
Following its initial public offering on September 11, Figure’s stock started trading at $36, valuing the business at over $7 billion. The IPO included the sale of more than 23 million Class A common shares, in addition to almost 8 million shares of the same class offered by current shareholders. According to TradingView, FIGR was trading up 2.2% in pre-market activity on Monday, priced at $41.19.
FIGR/USD price chart. Image: TradingView.
Founded by Mike Cagney, who also co-founded SoFi, Figure has become a leader as an independent, non-bank provider of home equity lines of credit (HELOCs) in the U.S. Analysts state that it holds about 13% of the non-depository market, and originated $5.1 billion in HELOC loans in 2024. Bernstein projects Figure’s market share will increase to roughly 25% by 2027, while also broadening its tokenization model to include additional loan products and asset categories.
With a substantial market opportunity of approximately $2 trillion for credit tokenization, analysts anticipate Figure’s revenue to grow from $341 million in 2024 to approximately $754 million by 2027 – representing an annual growth rate of about 30%. EBITDA is projected to increase from $101 million to $427 million during the same timeframe, with profit margins expanding from 30% to 57% as the company shifts from direct lending to a fee-based marketplace structure via its “Figure Connect” platform.
Gautam Chhugani has personal investments in several cryptocurrencies. Bernstein, including its affiliates, might be compensated by Figure Technology Solutions for services related to investment banking.
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