One beaten-down financial services company is getting a little love from an analyst tracking the stock. On Friday, Green Dot (NYSE:GDOT) was the subject of a new, and very bullish, research note issued by Craig-Hallum prognosticator Bradley Berning. At is current level, the stock is undervalued by nearly 60%, Berning believes, and is well poised to spring higher. The analyst is reiterating his buy recommendation on Green Dot shares, and his $72 per share price target.

Green Dot is known for its prepaid debit cards, which are widely available in many retail stores and supermarkets. The company also operates as a bank, with a straightforward and low cost offering that targets first-time or otherwise unbanked individuals.

A customer and a merchant making a payment card transaction.

Image source: Getty Images.

The Craig-Hallum analyst argues that investors are not aware that the company's "boring" business is full of potential. One aspect of its operations is its Reload Network, within which debit card holders can "refill" the amounts packed into their plastic. They can do so at a vast number of registers at the company's partner retailers, one reason why Berning feels that this business alone is worth a minimum of $1 billion (in its entirety, Green Dot's market capitalization is just over $2.5 billion).

Meanwhile, other Green Dot operations are headed north. For example, the analyst expects that the number of cash transfers through the company's network will improve at a 4% compound annual growth rate (CAGR) through 2025. The market is not taking into account this kind of trajectory, Berning believes.

"Excluding the reload network, investors are effectively buying the rest of the business at 6 [times] EV/EBITDA, despite key metrics trending in a positive direction and a long list of future growth opportunities, he wrote in his note.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis -- even one of our own -- helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.