Shares of the subprime lender OppFi (OPFI -2.65%) had fallen more than 10% as of 1 p.m. ET today after the company appointed a new CEO and also provided some guidance on its full-year results for 2021.
OppFi announced that Neville Crawley has "stepped down" from his role as CEO and as a director. The news is shocking because OppFi only appointed Crawley as CEO last December to replace former CEO Jared Kaplan, who had surprisingly stepped down at the time. There was nothing that really explained Crawley's sudden departure in the news release.
OppFi, which has yet to report earnings results for the fourth quarter of 2021, also provided guidance for what to expect for full-year results in 2021. The company said to expect adjusted net income between $64 million and $66 million, which is toward the top end of previous guidance. OppFi also said to expect ending loan receivables between $335 million and $338 million, which is up from the prior outlook of between $315 million and $325 million.
However, full-year revenue guidance of between $350 million and $352 million and adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) between $115 million and $117 million is either toward the bottom of or below prior guidance.
I initially bought into OppFi because I liked the platform the company was building and how the company managed consistent profitability in a difficult industry. But two sudden CEO changes in three months is simply unacceptable.
With interest rates set to rise throughout the year, the company faces enough challenges with the potential for higher loan losses and slowing consumer demand. This is no way to build confidence.
At this point, I am just holding my shares in hopes that tech and fintech stocks eventually rebound after such a harsh sell-off over the past few months. I certainly hope the company has some further information to provide on its upcoming earnings call on March 10.