NetSpend Holdings Gaining More Customers For Its Reloadable Pre-Paid Debit Cards

NetSpend Holdings has evolved from being solely a provider of pre-paid cards to a broader financial services enterprise, catering to 60 million U.S. consumers who lack bank accounts or don't qualify for traditional credit cards. The company functions similarly to a bank for the unbanked, without the burden of extensive federal regulations. Its financial performance has surpassed Wall Street expectations, with accelerated growth in profits and revenues forecasted for 2012 and 2013. A key growth driver has been direct deposits on its reloadable prepaid debit cards, leading to a significant increase in gross dollar volume. Analyst John Kraft rates the stock as a buy, anticipating continued stock price increases. NetSpend CEO Daniel R. Henry highlights the company's extensive partnerships and numerous reloading locations as catalysts for future growth. Despite potential competition, Henry welcomes it, seeing it as beneficial for brand awareness. Financial analyst Greg Smith also rates the stock a buy, citing strong card growth and direct deposit increases, forecasting earnings slightly above management's guidance. Both analysts predict further stock price appreciation, supported by solid fundamentals and growth prospects.