Last Updated: 04 Nov 2024
Executive Summary
Pagaya Technologies Ltd. (PGY) is a financial technology company with a market capitalization of $854.37 million. The company has been experiencing revenue growth, but its profitability metrics remain negative. The stock price is currently trading at $11.68, below its 52-week high of $20.50. Analysts have mixed ratings on the stock, with a majority recommending a "Buy" rating.
Company Overview
Pagaya Technologies Ltd. is headquartered in Tel Aviv, Israel, and provides artificial intelligence (AI)-powered lending solutions to banks and other financial institutions. The company's technology uses machine learning to assess the creditworthiness of borrowers, enabling lenders to make more informed decisions. Pagaya operates in the United States, Israel, and the Cayman Islands.
Fundamental Analysis
Revenue: Pagaya's revenue has grown steadily in recent quarters, reaching $925.42 million in the trailing twelve months (TTM). This represents a 28% increase from the same period last year.
Profitability: The company's profitability metrics remain negative. Its EBITDA for the TTM is $48.13 million, and its net income is -$120.96 million. This is primarily due to the company's high operating expenses, which include research and development costs.
Valuation: Pagaya's stock is currently trading at a forward price-to-earnings (PE) ratio of 8.98. This is below the industry average of 12.54. However, the company's high beta of 6.39 indicates that its stock price is more volatile than the overall market.
Technical Analysis
Trend: The stock price has been in a downtrend since reaching its 52-week high in March 2023. It is currently trading below its 50-day and 200-day moving averages.
Support and Resistance: The stock has support at $11.00 and resistance at $12.50.
Momentum: The stock's momentum is currently negative, as indicated by its declining moving averages and relative strength index (RSI).
Short Term Outlook
In the short term, Pagaya's stock price is likely to remain under pressure due to its negative profitability metrics and weak technical indicators. The stock may find support at $11.00, but a break below this level could lead to further declines.
Long Term Outlook
Pagaya's long-term outlook is more positive. The company's AI-powered lending solutions have the potential to disrupt the traditional lending industry. If Pagaya can successfully scale its business and improve its profitability, its stock price could see significant upside.
Analyst Recommendations
Analysts have mixed ratings on Pagaya's stock. Out of 10 analysts, 1 recommends a "Strong Buy," 5 recommend a "Buy," 3 recommend a "Hold," and 1 recommends a "Sell." The average analyst target price is $22.89, which implies a potential upside of 96% from the current price.
