Blend Labs stock holds $7 target despite YTD drop

On Wednesday, Blend Labs Inc. (NYSE: NYSE:BLND), currently trading at $3.54 with a market capitalization of $915 million, maintained its Market Outperform rating and $7.00 price target from Citizens JMP, despite a year-to-date (YTD) performance showing a 16% decline. The reassurance in the stock's potential comes after a series of investor meetings in the San Francisco Bay Area. According to InvestingPro , analysts' targets range from $4 to $7, with a consensus recommendation leaning towards Buy.

Analysts at Citizens JMP expressed their continued confidence in Blend Labs following discussions with the company's Head of Finance & Administration, Amir Jafari. These meetings, which took place on Thursday, provided an opportunity for investors to gain insights into the company's operations and financial strategies.

Blend Labs has experienced a notable decline in its stock price this year, with a 16% drop compared to the Russell 3000 index, which has remained relatively flat over the same period. The decline has been more pronounced over the past six months, with a 31.8% decrease. Despite this downward trend, the firm's analysts see the current valuation as an opportunity to maintain their positive stance on the stock. InvestingPro subscribers have access to 8 additional key insights about BLND's valuation and growth prospects through exclusive ProTips.

The $7.00 price target set by Citizens JMP suggests that the firm believes in the intrinsic value and growth prospects of Blend Labs. This target remains unchanged even as the company's shares have struggled in the broader market.

Investors and market watchers will likely continue to monitor Blend Labs' performance closely, especially in light of the maintained rating and price target by Citizens JMP. The company's future activities and financial results will be critical in determining whether the stock can meet or exceed the firm's expectations.

In other recent news, Blend Labs reported its first-quarter 2025 earnings, revealing an earnings per share (EPS) loss of $0.01, which fell short of the forecasted $0.01 gain. Revenue for the quarter was also below expectations at $26.77 million, compared to the anticipated $43.18 million. Despite these misses, the company highlighted a 12% year-over-year growth in platform revenue, supported by a strong non-GAAP gross margin of 73%. Keefe, Bruyette & Woods (KBW) responded to these developments by raising Blend Labs' stock target to $4.00, citing a cleaner financial outlook and operational efficiency. KBW also noted Blend Labs' strategic initiative to sell its Title365 business, aiming to streamline its focus on a software-first model.

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Additionally, JMP analysts maintained their Market Outperform rating for Blend Labs with a price target of $7.00, projecting revenues from continuing operations to reach $135.1 million in 2025, a 17% increase year-over-year. Looking further ahead, JMP expects revenues to grow to $176.8 million in 2026, marking a 31% increase. Blend Labs' future guidance remains optimistic, with the company projecting second-quarter platform revenue between $30.5 million and $32.5 million. The company's strategic shift towards a software-first model and the introduction of AI-driven tools are expected to drive future growth.

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