Dave Stock Tanked 27.5% In A Week, Time To Buy The Dip?
Dave stock has fallen by 27.6% in less than a month, from levels of $279.80 on 7/7/2025 to $202.66 now. Should you buy this dip? Dip buying is a viable strategy for quality stocks when broad market conditions are favorable, provided that the stock has a history of recovering from dips.
As it turns out, not only does Dave pass basic fundamental quality checks, but it has also returned (on average) 291% in one year, and 368% as peak return following sharp dips (>30% in 30 days) historically. That said, if you seek upside with lower volatility than individual stocks, the Trefis High Quality portfolio presents an alternative – having outperformed the S&P 500 and generated returns exceeding 91% since its inception.
Historical Median Returns Post Dips
| Period | Past Median Return |
|---|---|
| 1M | 9.6% |
| 3M | -8.0% |
| 6M | -19.8% |
| 12M | 205.7% |
Historical Dip-Wise Details
DAVE had 6 events since 1/1/2020 where the dip threshold of -30% within 30 days was triggered
- 304% median peak return within 1 year of dip event
- 120 days is the median time to peak return after a dip event
- -38% median max drawdown within 1 year of dip event
| 30 Day Dip | DAVE Subsequent Performance | |||||||
|---|---|---|---|---|---|---|---|---|
| Date | DAVE | SPY | 1Y | Peak Return |
Max Drop |
# Days to Peak |
||
| Median | 206% | 304% | -38% | 120 | ||||
| 6262024 | -38% | 5% | 778% | 695% | -2% | 365 | ||
| 10132023 | -34% | -4% | 796% | 938% | -2% | 209 | ||
| 3172023 | -32% | -6% | 403% | 462% | -31% | 356 | ||
| 1062023 | -31% | -3% | 8% | 21% | -44% | 31 | ||
| 9082022 | -34% | -0% | -58% | 11% | -70% | 4 | ||
| 1072022 | -42% | -0% | -96% | 146% | -96% | 25 | ||
Dave Passes Basic Financial Quality Checks
Revenue growth, profitability, cash flow, and balance sheet strength need to be evaluated to reduce the risk of a dip being the sign of a deteriorating business situation.
| Quality Metrics | Value | Quality Check |
|---|---|---|
| Revenue Growth (LTM) | 39.3% | Pass |
| Revenue Growth (3-Yr Avg) | 33.5% | Pass |
| Operating Cash Flow Margin (LTM) | 39.9% | Pass |
| Leverage (see below) | – | Pass |
| => Interest Coverage Ratio | 8.5 | |
| => Cash To Interest Expense Ratio | 11.7 |
Dip buying, while attractive, needs to be evaluated carefully from multiple angles. Such multi-factor analysis is exactly how we construct Trefis portfolio strategies. If you want upside with a smoother ride than an individual stock, consider the High Quality portfolio, which has outperformed the S&P, and clocked >91% returns since inception.