FinWise Bancorp (FINW) has disclosed the terms for its IPO. The company plans to raise around $58 million in the offering. Is FINW IPO stock a good buy for investors? What can investors expect following the IPO?
Founded in 1999, FinWise is a Utah-based digital bank that provides loan and deposit services across the U.S. In the first quarter, the bank originated $1 billion in total loans.
FinWise Bancorp’s IPO news
FinWise plans to offer 4.13 million shares at $13–$15 per share. The company is offering 3.57 million shares in the IPO, while the selling shareholder is offering about 0.56 million shares. The company won't receive any proceeds from the sale of shares by the selling shareholder. FinWise will use the net proceeds from the offering to fund organic growth, to continue the buildout of its operating infrastructure, and for general corporate purposes.
FinWise Bancorp’s IPO date
FinWise hasn’t officially revealed its IPO date yet, but various reports indicate that it could come as early as Aug. 12. Existing investors haven’t shown an interest in acquiring shares at the IPO price. Piper Sandler and Stephens are the underwriters for the IPO. The underwriters have the option to buy an additional 0.5 million shares at the IPO price. FinWise filed confidentially on May 13.
FinWise Bancorp is profitable.
FinWise reported a net income of $11.2 million in 2020 compared to $9.7 million in 2019. Its revenue rose 38 percent YoY to $29.5 million in 2020 and 10 percent YoY to $8.8 million in the first quarter of 2021. As of March 31, 2021, the company had cash and cash equivalents of $74 million, total loans of $245 million, and total deposits of $189 million.
FinWise Bancorp’s IPO valuation
The IPO will value FinWise at $183 million, and its terms put the company’s 2020 price-to-earnings multiple at 16.3x. While that multiple might look high in absolute terms, FinWise is a high-growth stock and its sales should rise significantly in the coming years. In comparison, Bank of America and Wells Fargo are trading at NTM PE multiples of 14.0x and 14.2x, respectively.
FinWise Bancorp’s stock price and ticker symbol
FinWise stock will trade under the ticker symbol “FINW.” The stock will be listed on the Nasdaq. The company is offering IPO shares at $13–$15.
Is FinWise Bancorp IPO stock a good buy?
FinWise offers loan and deposit services to consumers and small businesses in the U.S. The services are offered both directly and through strategic programs. FinWise has expanded significantly amid the COVID-19 pandemic and seems to be well-positioned as small businesses seek funding to start or expand their operations as the pandemic wanes.
FinWise has received about $18 million in equity investment from investors. Overall, FinWise might be worth a closer look for investors looking for a prospective fast-growing bank with a nationwide reach.
How to buy FinWise-Bancorp IPO stock
FinWise stock can be bought using a traditional or online discount broker like Robinhood.