FinTech IPO index gains 1.7% on OppFi, Huize earnings

One day left in the quarter.

And then the earnings season starts again in just a few weeks.

But even in the last few days, as March draws to a close, earnings for the December period continued to swing share prices for the names in our FinTech IPO Index.

March was a tough month for the index, which fell 10% for the month (with one day to go, to be sure). And so far this year, gains have been reduced to 8.5% at the time of writing.

Among companies that showed gains over the past five sessions (offsetting a 22% loss in Triterras, where no company-specific news crossed the lines), Oportun was up 17%. The news came this week that The Consumer Financial Protection Bureau (CFPB) has informed Oportun via letter that the agency has completed its investigation of the company. The CFPB stated that its Office of Enforcement staff concluded that it would not recommend pursuing enforcement action against the company. As has been reported, the CFPB had been investigating Opportun’s fundraising practices from 2019 to 2021, along with its hardship program during the COVID-19 pandemic.

Earnings drive several names higher

Huize was 16% higher.

The company reported results for the fourth quarter which showed that renewal premiums arranged on the company’s platform increased by almost 81%.

The cumulative number of insurance customers served increased to approximately 8.4 million as of December 31, 2022, up from 7.5 million in the prior year. Management noted on the conference call with analysts that these growth rates – with a 16% increase in gross premium income – came even though gross written premiums across the insurance industry in China were down 16%.

OppFi collected 14.4% in the wake of its separate results report that showed it total revenue increased 25% year over year to $120 million. Net originations were flat year over year at $187 million.

Management noted on its conference call that in the fourth quarter the “default payment rate” for new customers continued to move closer to pre-pandemic levels, down 29% from the second quarter before credit adjustments.

Futu Holdings rose 7.3 percent. Futu’s latest earnings report, released this past week, showed that the company’s total number of paying customers increased by 19.5% year-on-year to 1.5 million. The total number of registered customers increased by 17.5% year-on-year to 3.2 million over the same time frame. The company reported that in the fourth quarter of 2022, daily average revenue fell 12.7% year-over-year, but revenue increased 42.3% to $292.3 million.

Apple pushes into BNPL

Affirm was up 7.6% in a week as Apple officially launched its own BNPL initiative. As mentioned here, Apple has begun rolling out an installment payment program built into Apple Wallet called Apple Pay Later. As for the payment option itself, users can split purchases into four payments spread over six weeks without paying interest and fees. Users can apply for Apple Pay Later loans of $50 to $1,000, use them for online and in-app purchases made on iPhone and iPad, then track, manage and repay the loans in Apple Wallet, we reported this week.