Bernstein is bullish on FIGR’s upgrade from a HELOC lender to a tokenized credit marketplace platform

Overview

This report positions Figure Technology Solutions as evolving from a direct-to-consumer HELOC lender into a credit market infrastructure platform spanning AI underwriting, loan-asset tokenization, blockchain settlement, and institutional and DeFi liquidity access. Bernstein believes the market still largely prices FIGR as a small fintech lender, underestimating its roughly $4 trillion annual credit origination TAM across HELOC, auto loans, mortgages, mortgage-adjacent categories, small-business loans, and crypto loans.

Core views

The core view is that FIGR’s growth opportunity is sufficient to offset investor concerns about take-rate compression. The report expects FIGR’s total loan volume to grow from $8.4 billion in CY25 to $16.5 billion in CY27E, a CY25-27E CAGR of 41%; net revenue to rise from $507 million in CY25 to $916 million in CY27E, a CAGR of 34%; and adjusted EBITDA to increase from $251 million in CY25 to $548 million in CY27E, a CAGR of 48%, with the EBITDA margin rising from 49% to 60%. After Figure Connect scales, the business model will shift more toward high-margin, asset-light marketplace revenue.

Analysis framework

The report uses TAM segmentation, product-line loan volume forecasts, channel mix forecasts, a take-rate bridge, revenue and EBITDA forecasts, and an EV/EBITDA valuation framework. The analysis focuses on HELOC market share gains, penetration of non-HELOC loan categories, AI underwriting reducing costs and shortening funding time, blockchain tokenization improving settlement transparency and liquidity, and the contribution of Figure Connect and Democratized Prime to capital-markets access.

Methodology notes

• Market opportunity sizingTAM deep dive

  Segmenting the annual origination market by loan category

  The report breaks down FIGR’s addressable TAM into approximately $0.2 trillion for HELOC, $0.8 trillion for auto loans, $2.0 trillion for mortgages, $0.5 trillion for mortgage-adjacent categories, $0.5 trillion for small-business loans, and $0.1 trillion for crypto loans, totaling about $4 trillion.

• Financial forecastvolume and take rate bridge

  Loan volume growth offsets take-rate compression

  The report expects net take rate to fall from 4.0% in CY25 to 3.6% in CY27E, but loan volume expansion and channel mix changes still drive consumer loan revenue from $398 million to $696 million.

• Valuation methodsEV/EBITDA multiple

  25x EV/2027E EBITDA

  Bernstein values FIGR at 25x EV/2027E EBITDA, assigning a premium to traditional exchanges and crypto peers because it combines the growth profile of a pure tokenization platform with a profitable core lending business.

Asset mapping & comparison

Structured mapping from thesis to named assets (strengths, weaknesses, peers, risks).

• FIGR.US

  Core covered company

  Strengths

  AI underwriting, low-cost LOS, blockchain tokenization, Figure Connect liquidity network, HELOC operating experience, and institutional capital-markets access.

  Weaknesses

  Current revenue remains highly dependent on HELOC, non-HELOC expansion is still early, and take rate faces normalization pressure.

  Comparison

  The report believes the market still views it as a niche fintech lender rather than a platform covering credit tokenization and marketplace infrastructure.

  Risks

  A rapid decline in interest rates could intensify refinancing competition, private credit growth could slow, non-HELOC expansion could be delayed, and adoption of tokenized credit could fall short of expectations.

• HELOC

  Current core loan category

  Strengths

  Supported by high-quality collateral, high prime mix, Figure LOS significantly reduces costs and shortens funding time, and Connect and securitization channels improve liquidity.

  Weaknesses

  Market size is relatively smaller than non-HELOC categories, and demand is affected by interest rates and competition from home-equity loans.

  Comparison

  FIGR expects HELOC market share to rise from 4.1% in CY25 to 6.6% in CY27E.

  Risks

  HELOC demand may weaken when mortgage refinancing becomes more attractive.

• Figure Connect

  Key channel for growth and margin expansion

  Strengths

  Provides a blockchain-based two-sided marketplace for loan originators and blue-chip private credit investors, generating high-margin fee revenue without balance-sheet exposure.

  Weaknesses

  Depends on partner integrations, market liquidity, and continued growth in investor demand.

  Comparison

  Its share of total loan volume is expected to rise from 46% in CY25 to 63% in CY27E, exceeding the Figure Branded and Figure as Intermediary channels.

  Risks

  A slowdown in private credit or a decline in institutional investor risk appetite would affect platform transaction volume.

• Auto loans

  Non-HELOC expansion direction

  Strengths

  The U.S. auto loan and lease origination market is about $780 billion, and FIGR can access assets through its Agora partnership using AI quality checks and tokenization without owning the front-end origination system.

  Weaknesses

  Prime auto loans are mainly dominated by banks, credit unions, and captive auto finance companies, and FIGR lacks HELOC-like origination advantages.

  Comparison

  FIGR’s advantages lie more in capital-markets access, blockchain transparency, and operating efficiency than in front-end loan origination.

  Risks

  Rising auto loan delinquencies, insufficient partner volume ramp-up, or asset-quality volatility.

• Mortgages and mortgage-adjacent loans

  Large TAM expansion direction

  Strengths

  U.S. single-family mortgage originations are about $2 trillion in CY25, with collateral and prime-quality characteristics similar to HELOC; the Loan Depot partnership shows LOS can expand with low incremental cost.

  Weaknesses

  The traditional mortgage market is highly competitive, with large institutional and non-bank mortgage companies.

  Comparison

  Mortgages are the largest single item in the report’s TAM segmentation, significantly larger than HELOC.

  Risks

  Mortgage rate cycles, refinancing competition, regulatory risk, and partner execution risk.

• Small-business loans

  Emerging loan category

  Strengths

  Alternative lenders have a high share, and approval speed and capital-markets access may become FIGR’s differentiating advantages.

  Weaknesses

  The product is still under development, and scale contribution is early.

  Comparison

  In Q4’25, small/mid-sized business loans contributed $46 million of FIGR’s $97 million in incremental new loan volume.

  Risks

  Credit risk, underwriting standards, and competition in the SBA and alternative lending markets.

Key data

• Rating and target priceOutperform; PT $67FIGR’s closing price on May 4, 2026 was $36.04, implying 86% upside.
• April loan volume$1.34Bn; +12% MoM; +108% YoYLoan volume exceeded $1 billion for the second consecutive month, setting a monthly record.
• Total loan volume forecastCY25 $8.4Bn; CY27E $16.5BnCY25-27E CAGR is 41%.
• CY27E loan mixHELOC $13.2Bn, 80%; new loan categories $3.3Bn, 20%Non-HELOC penetration in the $3.8 trillion TAM is about 9 basis points.
• Figure Connect channel shareCY25 46%; CY27E 63%The report believes Connect will become the dominant distribution channel.
• Net revenue forecastCY25 $507Mn; CY27E $916MnCY25-27E CAGR is 34%, with consumer loan revenue as the main incremental source.
• Adjusted EBITDACY25 $251Mn; CY27E $548MnEBITDA margin is expected to rise from 49% to 60%.
• Net take rateCY25 4.0%; CY27E 3.6%It declines due to changes in channel and product mix, but loan volume growth is expected to offset the impact.
• HELOC operating advantagesProduction cost per loan reduced by 90%; funding time shortened by 75%Under Figure LOS, HELOC production cost is below $1,000 versus an industry average of about $11,000; funding takes about 10 days versus an industry median of 43 days.
• HELOC market shareCY25 4.1%; CY27E 6.6%CY27E HELOC origination is expected to be $13.2 billion.

Impact & implications

If the report’s assumptions materialize, FIGR’s investment case will shift from a single HELOC lender to a tokenized credit infrastructure platform, allowing valuation to receive a growth-platform premium. Expansion into new loan categories, Figure Connect volume ramp-up, and DeFi capital access will improve revenue visibility and margins; however, investors still need to track new loan product execution, take-rate normalization, private credit demand, and the macro interest-rate environment.

Risks

• A rapid decline in interest rates may make mortgage refinancing more competitive, thereby affecting HELOC demand.
• FIGR depends on continued growth in private credit; if private credit slows, adoption of the tokenized credit marketplace may come under pressure.
• The report expects non-HELOC loans to contribute about 20% of loan volume by CY27E; if expansion in auto loans, small-business loans, DSCR, or mortgages is delayed, loan growth will be affected.
• Net take rate falls from 4.0% in CY25 to 3.6% in CY27E; if loan volume growth is insufficient, revenue growth may be below expectations.
• Businesses related to DeFi, stablecoins, RWA tokenization, and cross-chain yield distribution may face regulatory, technical, and market-acceptance risks.
• Disclosures show that Bernstein and its affiliates have potential conflicts of interest with Figure Technology Solutions, including investment banking services, shareholdings, or seeking future compensation for services; investors should make independent judgments in conjunction with the disclosures.

What to watch

• Whether monthly loan volume continues to remain above $1 billion and whether YoY growth continues.
• Whether HELOC market share rises as expected from 4.1% in CY25 to 6.6% in CY27E.
• The number of Figure Connect partners, its share of loan volume, and institutional investor demand.
• Actual volume ramp-up in non-HELOC loans, especially auto loans, SMB loans, DSCR, and mortgage-adjacent products.
• Whether net take-rate compression can be offset by loan volume growth and high-margin marketplace revenue.
• Whether adjusted EBITDA margin expands as expected from 49% to 60%.
• Private credit, ABS issuance, mortgage/auto loan delinquency rates, and changes in macro interest rates.