By Lisa Thompson

OTC:CLPMF

READ THE FULL CLPMF RESEARCH REPORT

Clip Money (OTC:CLPMF) just reported its fourth quarter, the seasonally strongest of the year, as its revenues are dependent on both the amount of cash and the number of transactions its customers make, and clearly, Christmas is the quarter for the peak of both. Revenue for Q4 2024 was $1.2 million, beating our expectations and compared to $353,000 in Q4 of 2023, representing 227% growth. The company estimates the seasonality lift in Q4 2024 was approximately 19% of total revenue. Excluding the impact of seasonality, revenue grew 78% from Q3 2024. The company added 35 new ClipDrop deposit locations in Q4 at mall operators like: Pacific Retail, CBL, Westfield, Preit, Brookfield Properties, and Taubman. It also signed 962 new, active depositing users. ClipChange continues to grow, and this new product was used by 16 customers across 673 store locations in 2024. At the end of the quarter, the company had 444 ClipDrop boxes installed, up from 396 at the end of 2023, or 12% more.

The most exciting event of 2025 is expected to be Clip Money going live on the Green Dot network which is slated for June or July. The company plans to start with larger, more prestigious retail chains in the Green Dot network and then add many but not all of the 95,000 outlets Green Dot has. The company expects to add current customers that have individual stores not in malls or malls without a ClipDrop, as well as Green Dot customers. Management even expects to sign a bank this year or next as it is an inexpensive way to serve business customers without adding physical locations. Even now, Clip Money has the largest non-bank business deposit network by number of locations, with over 7,700 total deposit locations across the U.S.

While we expect a drop-off sequentially in Q1 due to seasonality, it should not be as great as the drop-off in sales of its customers due to minimums. Q1 should be the last quarter with negative gross margins as subsequent quarters should be higher than $1.1 million in revenues, and economics continue to improve from higher prices charged to new customers combined with economies of scale. With expanding margins and increased revenue, we expect that Clip Money should reach cash flow breakeven by the beginning of 2026, if not sooner.

Clip Money’s revenues grew 308% in 2024 and could grow 200% in 2025. It is currently at a $4.6 million revenue run rate and has been ramping revenues and decreasing losses as it adds customers and expands its network. The company trades at a $16 million market cap and $24 million enterprise value. We expect revenues in 2025 to reach or exceed $6.5 million. At a growth rate near 200%, we believe the company is worth 6.0 times 2025 revenues or $0.31 per share. In 2026, we expect revenues to at least double, given all the new locations coming online from the Green Dot partnership.

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