Shares surge in after-hours trading following better-than-expected earnings and revenue
Pagaya Technologies Ltd. (PGY) experienced a significant rally in share price during the extended session on Thursday. The AI-backed fintech data company exceeded Wall Street expectations with its adjusted results and optimistic outlook.
Impressive Financial Performance
Despite a 5% decline in regular trading hours, Pagaya shares skyrocketed as much as 37% after the market closed, reaching $2.31. Year to date, the company’s stock has surged over 85%, outperforming the S&P 500 index which has seen a more modest 16% gain.
In the second quarter, Pagaya reported a loss of $31.3 million, or 4 cents per share. This marks a significant improvement from the $175.3 million loss, or 71 cents per share, in the same period last year. After adjusting for stock-based compensation expenses and other items, the company reported earnings of $886,000, or breakeven per share. This compares favorably to the loss of $18.6 million, or 7 cents per share, in the year-ago period.
Pagaya’s adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) came in at an impressive $17.5 million, far exceeding the FactSet consensus estimate of $5.6 million.
Robust Revenue Growth
Total revenue for the quarter rose 7.8% to $195.6 million compared to $181.5 million in the same quarter last year. Revenue from fees showed even stronger growth, increasing by 13.7% to $185.6 million from $163.3 million.
Analysts had projected a loss of 3 cents per share and an adjusted breakeven bottom line, with revenue forecasted at $188.9 million. Pagaya’s results clearly surpassed these predictions, indicating a strong performance during the quarter.
In summary, Pagaya Technologies’ Q2 results are impressive, signaling the company’s strength and growth potential. With a significant rally in share price and better-than-expected financials, Pagaya continues to position itself as a leader in the fintech industry.
Pagaya’s Strong Financial Forecast
Pagaya, a leading financial technology company, is expecting impressive financial results for the third quarter and the full year. According to the company’s forecast, adjusted EBITDA (earnings before interest, taxes, depreciation, and amortization) for the third quarter is predicted to be between $10 million and $20 million, with a total revenue ranging from $190 million to $200 million. For the entire year, Pagaya anticipates adjusted EBITDA of $40 million to $50 million on revenue of $775 million to $825 million.
These projections have generated significant interest among analysts who closely follow Pagaya. Prior to the release of these projections, analysts estimated adjusted EBITDA of $5.2 million on revenue of $207 million for the third quarter, and adjusted EBITDA of $16.7 million on revenue of $805.9 million for the year.
Impressively, Pagaya’s stock has received favorable ratings from the analysts. Out of the six analysts covering the stock, three have given it a buy-grade rating, while the remaining three have a hold rating. The consensus among these experts is that Pagaya has great potential, with an average target price of $2.93.
Notably, Benchmark analyst Michael Legg, who regards Pagaya as a buy, recently raised his price target for the stock from $2 to $6 ahead of the company’s earnings report. Legg believes that Pagaya is uniquely positioned to leverage its platform and tap into a significant total addressable market.
With the stock showing signs of rebounding, investors are starting to recognize Pagaya’s long-term potential. As a result, Legg argues that the stock deserves a market multiple, indicating future growth opportunities. As Pagaya prepares to release its earnings report, investors and experts alike are eagerly awaiting the confirmation of these positive forecasts.