NEW YORK ( TheStreet) -- Green Dot ( GDOT) shares opened sharply higher Wednesday after the pre-paid debit card company posted better-than-expected earnings while raising its sales targets. Green Dot shares were up 8.78% to $17.09 shortly after the market opened Wednesday. Compass Point Research and Trading analyst Doug Greiner raised his recommendation to "buy" from "neutral," while raising his price target to $20 from $15 while other analysts who are officially neutral showed signs of warming to the stock.
Green Dot "appears to be coexisting with American Express ( AXP)'s Bluebird product fairly well," wrote KBW analyst Sanjay Sakhrani. Sakhrani noted even though Green Dot has now had competitors operating in essentially all of its retail locations for five to 12 months, it managed to post strong revenue numbers. For example, at Wal-Mart ( WMT) locations Green Dot saw 11% revenue growth in the first quarter vs. a year ago, compared to 14% annualized growth in the fourth quarter of 2012. Green Dot raised 2013 revenue targets to a range of $525 million to $550 million from earlier projections of $510 million to $540 million.
Green Dot earned $15.6 million for the first quarter of 2013 vs. $16.4 million in the first quarter of 2012. It left earnings guidance for 2013 unchanged, citing an uncertain environment as it weighs the impact of new competition. That uncertainty caused Sakhrani to leave his recommendation unchanged at market perform. -- Written by Dan Freed in New York. Follow @dan_freed