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Tuesday, TD Cowen analysts maintained a positive stance on Priority Technology Holdings Inc. (NASDAQ:PRTH), currently trading at $7.73 with a market capitalization of $615 million, reiterating a Buy rating and setting a price target of $10.00. The firm’s analysis emphasized the company’s Priority Commerce Engine as increasingly significant for small to medium-sized business (SMB) acquiring, as well as B2B and enterprise payments. This importance is highlighted given the current economic conditions and the environment of rising interest rates. According to InvestingPro data, the company has demonstrated strong business momentum with 16.4% revenue growth in the last twelve months.
Analysts highlighted the evolution of Priority Technology’s business mix, suggesting that the changes have introduced countercyclical attributes that could lead to more stable revenue and earnings growth. Additionally, they noted a reduction in the company’s leverage, which they believe has not been fully recognized by the market. This observation aligns with InvestingPro analysis, which shows the stock has delivered an impressive 139% return over the past year, despite recent market volatility.
The analysts pointed out that Priority Technology’s shares are currently trading at a discounted valuation. They see this as an opportunity, given the company’s strong fundamentals and the underappreciation of its financial resilience and growth prospects.
The endorsement from TD Cowen underscores their confidence in Priority Technology’s business strategy and its ability to navigate the financial landscape effectively. The reiterated Buy rating and $10.00 price target reflect the firm’s expectation for Priority Technology’s stock performance.
Investors and market watchers will be keeping a close eye on Priority Technology Holdings Inc. to see if the company’s performance aligns with TD Cowen’s projections and if the stock will indeed reach or surpass the $10.00 price target set by the analysts.
In other recent news, Priority Technology Holdings Inc. reported its fourth-quarter 2024 earnings, exceeding expectations with an earnings per share (EPS) of $0.18 compared to the forecasted $0.06. The company’s revenue for the quarter was $227.1 million, slightly below the anticipated $229.43 million. Full-year 2024 revenue reached $879.7 million, marking a 16% increase from the previous year. Despite the positive earnings surprise, investor concerns over revenue shortfalls led to a decline in the company’s stock. Looking ahead, Priority Technology projects a 10-14% revenue growth for 2025, with anticipated total revenue ranging between $965 million and $1 billion.
In another development, Keefe, Bruyette & Woods maintained an Outperform rating on Priority Technology but lowered the price target from $14.00 to $12.00. This adjustment came after a 15% decline in the company’s shares following the Q4 earnings report. Analyst Timothy Switzer from Keefe, Bruyette & Woods highlighted that, despite macroeconomic challenges, the company’s long-term outlook is improving. Switzer noted that Priority Technology’s recapitalization efforts and certain recession-resistant business segments provide stability. These recent developments reflect a cautious yet optimistic view of Priority Technology’s future performance.
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