Stifel bumps Nvidia stock target, sees attractive valuation
On Thursday, KeyBanc Capital Markets adjusted its outlook on PROG Holdings (NYSE:PRG), reducing the company’s price target from $50.00 to $45.00, while maintaining an Overweight rating on the stock. The decision comes in the wake of PROG Holdings’ first-quarter performance, which surpassed expectations, and the subsequent lowering of its 2025 guidance due to macroeconomic challenges.
In the first quarter, PROG Holdings experienced a 4.0% decline in Gross Merchandise Value (GMV), mainly due to the bankruptcy and closure of all Big Lots (NYSE:BIG) stores. Despite this setback, management highlighted positive trends excluding this particular impact, with GMV achieving a low to mid-single-digit increase. The company maintains strong financial health with a current ratio of 4.34, indicating ample liquidity to meet short-term obligations. The adjustment of the 2025 guidance below consensus reflects the company’s cautious stance in response to a deteriorating macroeconomic landscape.
KeyBanc’s analyst, Bradley Thomas, noted that while the macro outlook presents significant uncertainty for many, PROG Holdings’ valuation remains appealing, with a 7.4x multiple on the projected 2026 earnings per share and an 18.1% free cash flow yield. The stock currently trades at an attractive P/E ratio of 5.42x, with a substantial free cash flow yield of 20%. For deeper insights into PROG Holdings’ valuation metrics and financial health, investors can access comprehensive analysis through InvestingPro’s detailed research reports, available for 1,400+ US stocks. Despite the positive aspects, the lowered price target to $45.00 is a reflection of revised estimates based on the current economic climate.
The analyst’s commentary also touched on the performance throughout the quarter, observing that consumer trends worsened as the quarter advanced. The report suggests that while immediate results were encouraging, the broader economic context necessitated a more conservative approach to future projections.
Investors and market watchers will be keeping a close eye on PROG Holdings as it navigates the complex economic environment. The company’s ability to maintain its Overweight rating amidst these challenges indicates a level of confidence in its long-term potential, despite the need for adjustments in the short term.
In other recent news, PROG Holdings reported better-than-expected financial results for the first quarter of 2025. The company achieved an earnings per share (EPS) of $0.90, surpassing the projected $0.83. Revenue also exceeded expectations, coming in at $684.1 million compared to the anticipated $678.23 million. Despite these strong results, PROG Holdings revised its 2025 revenue outlook to a range of $2.425 billion to $2.500 billion, reflecting ongoing macroeconomic challenges. The company maintained its market position by expanding its active door count by nearly 5% and showed a 6.6% year-over-year increase in consolidated revenues. Additionally, Ford Technologies, a subsidiary of PROG Holdings, reported its first quarter of positive adjusted EBITDA, indicating strong performance within the company’s ecosystem. The company continues to navigate the impact of the Big Lots bankruptcy, which affected gross merchandise volume (GMV) by $30-$50 million. Analysts have not provided any recent upgrades or downgrades for the company’s stock.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.