Being a strategic investors requires being nimble, even if those same strategic investors may want to pick some stocks or sectors that they ride gains for year. Raymond James has announced an upgrade targeted toward strategic investors, but there may be some long-term opportunities as well based on the unique nature of why this upgrade was issued.
Paymentus Holdings, Inc. (NYSE: PAY) was raised to Outperform from Market Perform by Raymond Names after roughly a 30% pullback just since mid-May. The firm’s $37 price target also represented more than 25% in implied upside from the prior close.
Paymentus offers a cloud-based bill payment technology and solutions that lets consumers pay their bills using their preferred payment type and channel. It is still growing faster than most financials and fintech stocks, with 2024 revenues up over 40% and with Wall Street expecting 2025 to be the first year of $1 billion in revenues.
The strategic nature of this analyst call is that the massive pullback, which was referred to as a compelling buying opportunity, was not based on fundamentals of the company — but based on share distributions by Accel-KKR. This call was also less than a month ahead of its Q2 earnings report rather than being a post-earnings reactionary call.
And for the actual fundamentals, Raymond James is confident that consensus estimates for both Q2 and for 2025 appear to be conservative. Raymond James is above-consensus ahead of earnings and sees the potential for mid-single digit profit growth. The firm also sees low-double digit adjusted EBITDA upside for the year in its bullish case. in a 2025 bull case.
Paymentus’ stock was last seen up over 7 percent at $30.25 after the call. It’s 52-week trading range is $17.60 to $40.43.
