Street Calls of the Week
NEW YORK - Pagaya Technologies Ltd. (NASDAQ:PGY), a fintech company with $2.29 billion market capitalization and impressive 24.59% revenue growth, has amended and expanded its revolving credit facility to $132 million, more than doubling its previous $58 million facility, according to a press release statement issued by the company. InvestingPro analysis suggests the stock is currently undervalued, with analysts predicting profitability in the coming year.
The AI-driven financial technology firm, which generated over $1.15 billion in revenue over the last twelve months, secured a significant reduction in its borrowing costs, with the interest rate decreasing by approximately 35% from SOFR+750 to SOFR+350 basis points. This adjustment brings the cost of most of Pagaya’s corporate debt at or below the company’s recent high-yield bond coupon of 8.875%. For deeper insights into Pagaya’s financial health and 8 additional exclusive ProTips, visit InvestingPro.
The expanded facility attracted new banking partners including Wells Fargo, Citizens, TD Bank, and Texas Capital Bank, while existing lenders such as Bank of Montreal, Valley Bank, CIBC, and Israel Discount Bank increased their commitments.
"This expanded facility is another important milestone in fortifying our balance sheet and building a durable capital structure that positions Pagaya to thrive in all market cycles," said Evangelos Perros, Chief Financial Officer of Pagaya.
Pagaya Technologies provides AI-driven product solutions for the financial ecosystem, focusing on consumer credit and residential real estate products. The company maintains offices in New York and Tel Aviv.
The enhanced credit facility provides additional liquidity and financial flexibility for the company as it continues its growth initiatives. The transaction represents a strengthening of Pagaya’s funding position amid current market conditions.
In other recent news, Pagaya Technologies reported its second-quarter 2025 earnings, significantly surpassing expectations with an EPS of $0.64 compared to the forecasted $0.13. The company’s revenue also exceeded projections, reaching $326 million against an anticipated $311.96 million. Following these results, JMP Securities raised its price target for Pagaya to $35 from $26, maintaining a Market Outperform rating. Similarly, Keefe, Bruyette & Woods increased their price target to $38 from $27, citing a "record-setting quarter" with 14% year-over-year volume growth, surpassing Street expectations by 4%. Benchmark also reiterated its Buy rating on Pagaya, maintaining a price target of $48. These recent developments reflect a positive outlook from analysts, highlighting the company’s strong performance and growth potential.
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