In a report released today, David Scharf from JMP Securities reiterated a Buy rating on Pagaya Technologies Ltd (PGY – Research Report), with a price target of $2.25.
David Scharf has given his Buy rating due to a combination of factors. Key among these is Pagaya Technologies’ strong third-quarter results, which showed the successful execution of the company’s long-term growth plans. These results were marked by significant top-line and bottom-line growth, as the company increased the number of approved loans, demonstrating the unfolding operating leverage of their business model. Furthermore, this was the first time the company reported positive operating income on a GAAP basis. The company’s commitment to adding two to four large lending partners per year to achieve step function growth was also highlighted.
In addition, Scharf’s rating is based on Pagaya’s unique position in the marketplace lending landscape. The company’s funding model, which preempts funding disruptions, and its B2B2C model that integrates directly into other lenders’ platforms for underwriting turndowns, are some of the key differentiators. The company’s credit analytics and machine-learning capabilities further provides a robust network effect. Moreover, Pagaya’s ability to diversify beyond personal loans, specifically into auto and point-of-sale, reaffirms its potential for growth. Finally, the company’s impressive cost control measures leading to greater operating leverage, as well as the minimal disruptions from ongoing conflicts, further solidifies David Scharf’s Buy rating for Pagaya Technologies.
According to TipRanks, Scharf is a 5-star analyst with an average return of 9.7% and a 47.75% success rate. Scharf covers the Financial sector, focusing on stocks such as Bread Financial Holdings, Encore Capital, and Atlanticus Holdings.
In another report released on October 26, Benchmark Co. also reiterated a Buy rating on the stock with a $6.00 price target.
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Pagaya Technologies Ltd (PGY) Company Description:
Pagaya is a technology company offering financial products and services. Its sophisticated AI-driven credit and analysis technology enables real-time and comprehensive consumer credit and residential real estate solutions.
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