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Investing.com - Benchmark has reiterated its Buy rating on Repay Holdings (NASDAQ:RPAY) stock, maintaining an $8.00 price target following the company’s third-quarter 2025 earnings report released earlier this week. Currently trading at $3.45, the stock appears undervalued according to InvestingPro analysis, with shares down over 54% year-to-date.
The third-quarter results represent the final reporting period in which Repay’s normalized gross profit growth rate was distorted by one-off client losses incurred in 2024, according to Benchmark. This suggests that the fourth quarter of 2025 will be the company’s first "clean quarter" in a year. Despite revenue declining 0.58% over the last twelve months to $308.95 million, the company maintains a robust gross profit margin of 75.54%.
Benchmark noted that while the full lapping of client losses that have impacted Repay’s results over recent quarters is a positive development, management has reduced baseline expectations for the company’s gross profit growth. This caution comes as five analysts have revised their earnings downwards for the upcoming period, though consensus remains a Strong Buy with price targets ranging from $4 to $12.
The lowered growth expectations are primarily attributed to margin pressures resulting from Repay’s strategic decision to implement volume pricing to accelerate enterprise client onboarding. While currently unprofitable with a -$1.39 EPS for the last twelve months, analysts forecast the company will return to profitability with an EPS of $0.95 for fiscal year 2025.
Repay Holdings provides payment processing solutions for various markets including personal loans, automotive loans, and business-to-business payments. InvestingPro rates the company’s overall financial health as "FAIR" with a score of 1.98. For deeper insights into Repay’s financial metrics and growth potential, check out the comprehensive Pro Research Report available for this and 1,400+ other US equities.
In other recent news, Repay Holdings Corp reported its third-quarter 2025 earnings, revealing a notable miss on earnings per share (EPS) estimates. The company posted an actual EPS of -$0.08, significantly below the forecasted $0.21, resulting in a surprise of -138.1%. Despite the earnings miss, Repay’s revenue for the quarter was $79.1 million, exceeding expectations by 2.82%. DA Davidson responded to these mixed results by lowering its price target for Repay from $10.00 to $9.00, although it maintained a Buy rating on the company. The financial services firm highlighted that while revenue was slightly above their forecast, the adjusted EBITDA fell short of expectations. These developments reflect ongoing investor concerns regarding Repay’s profitability.
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