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Thursday, Payoneer Global Inc. (NASDAQ:PAYO) shares experienced a sharp decline, dropping over 14% at one point, despite the company reporting fourth-quarter earnings that surpassed Wall Street’s expectations. The $3.15 billion market cap company, which maintains a robust gross profit margin of 84.55%, provided full-year 2025 revenue and adjusted EBITDA guidance that exceeded consensus estimates. According to InvestingPro data, Payoneer has delivered an impressive 83.09% return over the past year, highlighting its strong market performance before this pullback.
The unexpected market response to Payoneer’s robust earnings report and positive outlook might appear counterintuitive. Benchmark analysts suggest that the sell-off reflects heightened investor expectations following a series of strong quarterly performances from the company. Concerns over the slowing pace of volume growth in two critical segments, B2B and ecommerce marketplaces, contributed to the downward pressure on Payoneer’s stock price. The company’s current P/E ratio of 24.24 and revenue growth of 18.97% suggest continued expansion, though both verticals showed moderating growth rates in the fourth quarter of 2024. For deeper insights into Payoneer’s valuation metrics and growth potential, InvestingPro subscribers can access comprehensive financial health scores and additional ProTips.
For 2025, management anticipates B2B and marketplace volume growth to be at 25% and in the high-single digits, respectively. This forecast is a deceleration from the 42% and 14% growth rates seen in 2024. The anticipated reductions in growth are attributed to a higher base and tougher comparisons in the B2B sector, and a remarkably strong performance by ecommerce marketplaces in the previous year. Analyst targets for Payoneer range from $11 to $14, suggesting potential upside despite the growth moderation.
Despite the market’s reaction, Benchmark analysts believe that Payoneer’s growth prospects should be viewed in light of the company’s ongoing efforts to position itself for sustained profitable growth. They have reiterated their Buy rating and a price target of $12 for Payoneer stock. The target is based on a 13x EV/EBITDA multiple of their forecasted FY26E adjusted EBITDA of $305.7 million.
The analysts argue that the market’s negative response to Payoneer’s solid fourth-quarter report is short-sighted. They posit that the company’s conservative guidance may pave the way for a series of beat-and-raise quarterly results throughout 2025, suggesting a potentially favorable outcome for the company in the longer term.
In other recent news, Payoneer reported its fourth-quarter 2024 earnings, revealing revenue of $224.3 million, which fell short of the forecasted $242.24 million. The company’s earnings per share (EPS) also missed expectations, coming in at $0.05 compared to the projected $0.06. Despite these misses, Payoneer achieved a 17% year-over-year revenue growth in the fourth quarter and reported a full-year revenue of $1.04 billion, marking an 18% annual increase. Northland Securities maintained an Outperform rating for Payoneer, with a $14 price target, highlighting the company’s strong core revenue and volume growth.
Additionally, Payoneer’s transaction volume increased by 18% year-over-year, reaching $22.5 billion, although the take rate experienced a slight decrease. The company also noted a 21% year-over-year growth in total volume to $80 billion and an 8% increase in active Ideal Customer Profiles (ICPs). Payoneer’s guidance for fiscal year 2025 forecasts revenues between $1.04 billion and $1.05 billion, aligning with consensus expectations. The company remains confident in its ability to maintain strong performance and capitalize on business momentum, with plans to expand its regulatory moat and modernize its technology infrastructure.
Strategic initiatives include the acquisition of Skuad, a global workforce and payroll management company, and an anticipated acquisition of a China-based payment service provider, pending regulatory approvals. Despite the optimistic outlook, the immediate market reaction to the Q4 revenue miss resulted in a notable decline in Payoneer’s stock.
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