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Saturday, January 22, 2022

Are Paysafe shares a buy right now? This is what you need to know

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It is common for stocks to fall sharply after producing disappointing gains, but a 42% drop in a post-gain session is nothing short of brutal. This, however, was the fate of Paysafe (PSFE) Stocks after last week’s press as the company’s third quarter results and outlook did not impress.

So where is Paysafe going from here?

Evercore analyst David Togut believes 2022 will be a “transition year with 2023 demonstrating the first potential proofs of improvement in the digital wallet business.”

In addition to cutting its outlook, Togut also downgraded Paysafe’s rating from Outperform (i.e. Buy) to In Line (i.e. Hold) and cut its price target from $ 15 to $ 4. Even after last year’s steep drop. week, the new figure still implies a fall of around 11% from current levels. (To watch Togut’s track record, click here)

Joining the underwhelming crowd, RBC’s Daniel R. Perlin added: “Regulations in Germany and the Netherlands, two key markets, are making it more difficult for gaming operators to profit, while limiting the number of licenses available; and prices need to be reset in some markets / tiers to be more competitive. “.

In the short term, the company plans to address issues by focusing on a better customer experience and adjusting prices to more closely resemble the overall market. Paysafe also intends to discard the underperforming product features and rearrange the budget. However, the company still expects the “weakness to continue” in the fourth quarter.

Therefore, Perlin believes that management will have to “regain investor confidence” before the stock can rebound significantly.

Meanwhile, the analyst has reduced the price target from $ 15 to $ 9, which however still suggests that the stock could double from here. Perlin’s Outperform (i.e. Buy) rating remains as is. (To look at Perlin’s track record, click here)

All in all, Street analysts are split on this, even though the bulls have the upper hand; based on 4 Buys and Holds, each, the stock qualifies with a moderate buy consensus rating. On where the share price is going, the prospects are more conclusive; the forecast predicts 12-month earnings of 84%, as the median target stands at $ 8.31. (See PSFE stock analysis on TipRanks)

To find good ideas for trading stocks at attractive valuations, visit TipRanks’ The best stocks to buy, a recently launched tool that brings together all of TipRanks’ equity information.

Disclaimer: The views expressed in this article are solely those of the featured analysts. The content is intended to be used for informational purposes only. It is very important to do your own analysis before making any investments.

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