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Paymentus Holdings (PAY)
NYSE:PAY
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Paymentus Holdings
(NYSE:PAY)
76Outperform
Positive Factors
Client Onboarding
Big new clients onboarded, and implementation speed faster than expected.
Q3 Financial Performance
Q3 results were exceptional, with gross revenue up 52% year-over-year and EBITDA beating expectations by 30%.
Negative Factors
Consumer Preferences
Consumer preferences don't change to new payment methods, IPN network/partnerships don't materialize, competitive and fragmented market, pricing pressure.
Guidance
The 1Q & '25 CP guide came in below the Street, both 3% below.
Paymentus Holdings (PAY) vs. S&P 500 (SPY)
Market Cap
$3.19B
Dividend YieldN/A
Average Volume (3M)561.60K
Price to Earnings (P/E)73.9
Beta (1Y)1.10
Revenue Growth41.86%
EPS Growth96.57%
CountryUS
Employees1,307
SectorTechnology
Sector Strength43
IndustryInformation Technology Services
Share Statistics
EPS (TTM)0.34
Shares Outstanding32,317,257
10 Day Avg. Volume371,418
30 Day Avg. Volume561,602
Financial Highlights & Ratios
PEG Ratio0.77
Price to Book (P/B)N/A
Price to Sales (P/S)3.91
Price to Cash Flow (P/CF)30.50
P/FCF Ratio30.50
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
$31.00Price Target Upside21.28% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering6
Paymentus Holdings Business Overview & Revenue Model
Company DescriptionPaymentus Holdings, Inc. is a leading provider of cloud-based billing and payment solutions, primarily serving the utilities, insurance, healthcare, and government sectors. The company offers an integrated platform that enables businesses to present bills, collect payments, and engage with customers in a seamless and secure environment. Paymentus aims to simplify and enhance the customer payment experience while providing its clients with efficient and effective billing and payment services.
How the Company Makes MoneyPaymentus Holdings generates revenue primarily through transaction fees charged for each payment processed on its platform. This includes fees from billers who utilize its services to facilitate payments from their customers. Additionally, the company earns money from subscription fees for access to its platform, which provides a suite of billing and payment management tools. Key revenue streams also include value-added services such as analytics and reporting, customer communication tools, and payment optimization features. Paymentus maintains strategic partnerships with financial institutions, technology companies, and payment processors, which enhance its service offerings and broaden its market reach.
Paymentus Holdings Financial Statement Overview
Summary
Paymentus Holdings exhibits robust financial health with strong revenue growth, improved profit margins, and efficient cash management. The company maintains a low debt-to-equity ratio, high equity ratio, and strong free cash flow, highlighting financial stability and effective operations.Income Statement
Paymentus Holdings demonstrated strong revenue growth with a 41.8% increase from 2023 to 2024. The gross profit margin improved to 27.3% in 2024, showcasing efficient cost management. The net profit margin increased to 5.1%, indicating improved profitability. EBIT and EBITDA margins also showed positive trends, reflecting operational efficiency.85
Very Positive
Balance Sheet
The company maintains a strong equity position with an equity ratio of 84.3%. The debt-to-equity ratio is low at 0.02, indicating minimal leverage. Return on equity improved to 9.1%, showcasing effective use of equity to generate profit. The balance sheet reflects financial stability with a growing asset base.78
Positive
Cash Flow
Paymentus Holdings reported significant free cash flow growth, with a solid operating cash flow to net income ratio of 1.44, indicating effective cash generation from operations. The free cash flow to net income ratio is also strong at 1.43, reflecting healthy cash management practices.80
Positive
| Breakdown | ||||
| Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|
| Income Statement | Total Revenue | |||
| 871.75M | 614.49M | 497.00M | 395.52M | 301.77M | Gross Profit |
| 238.17M | 182.34M | 149.68M | 121.38M | 92.63M | EBIT |
| 44.86M | 18.09M | -2.98M | 10.37M | 18.43M | EBITDA |
| 44.86M | 48.69M | 21.09M | 10.37M | 20.00M | Net Income Common Stockholders |
| 44.17M | 22.32M | -513.00K | 7.04M | 13.71M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | |||
| 209.41M | 179.36M | 147.33M | 168.39M | 46.67M | Total Assets |
| 576.25M | 504.86M | 461.54M | 472.94M | 124.87M | Total Debt |
| 8.41M | 10.51M | 10.82M | 8.80M | 10.03M | Net Debt |
| -201.00M | -168.85M | -136.51M | -159.58M | -36.64M | Total Liabilities |
| 90.65M | 75.25M | 64.36M | 86.81M | 40.50M | Stockholders Equity |
| 485.60M | 429.62M | 397.18M | 386.13M | 84.38M |
| Cash Flow | Free Cash Flow | |||
| 63.18M | 34.53M | -11.43M | -916.00K | 20.77M | Operating Cash Flow |
| 63.63M | 68.83M | 19.87M | 19.60M | 35.62M | Investing Cash Flow |
| -36.76M | -34.30M | -34.56M | -77.92M | -15.14M | Financing Cash Flow |
| -207.00K | -1.20M | -37.28M | 213.49M | -1.36M |
Paymentus Holdings Technical Analysis
Negative
25.56
Price Trends
28.84
Negative
31.19
Negative
26.36
Negative
Market Momentum
-0.58
Positive
46.62
Neutral
32.79
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For PAY, the sentiment is Negative. The current price of 25.56 is below the 20-day moving average (MA) of 27.45, below the 50-day MA of 28.84, and below the 200-day MA of 26.36, indicating a bearish trend. The MACD of -0.58 indicates Positive momentum. The RSI at 46.62 is Neutral, neither overbought nor oversold. The STOCH value of 32.79 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for PAY.
Paymentus Holdings Risk Analysis
Paymentus Holdings disclosed 57 risk factors in its most recent earnings report. Paymentus Holdings reported the most risks in the “Finance & Corporate” category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Paymentus Holdings Peers Comparison
Overall Rating
UnderperformOutperform
Sector (57)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
78 Outperform | $12.22B | 23.93 | 34.88% | 0.70% | 11.19% | 51.03% | |
76 Outperform | $3.19B | 73.92 | 9.65% | ― | 41.86% | 96.57% | |
73 Outperform | $33.43B | 11.04 | 14.50% | ― | 10.06% | 38060.98% | |
73 Outperform | $22.86B | 15.09 | 6.94% | 1.07% | 4.68% | 63.39% | |
63 Neutral | $43.98B | 82.66 | -47.82% | ― | 14.49% | 21.85% | |
61 Neutral | $442.51M | ― | -3.08% | ― | 14.82% | -461.78% | |
57 Neutral | $20.94B | 10.43 | -13.41% | 2.52% | 4.53% | -23.34% |
* Technology Sector Average
Performance Comparison
PAY
Paymentus Holdings
24.13
2.86
13.45%
FICO
Fair Isaac
1,673.98
435.10
35.12%
GPN
Global Payments
84.88
-41.93
-33.07%
GDOT
Green Dot
7.44
-0.96
-11.43%
PAYC
Paycom
198.11
-2.17
-1.08%
XYZ
Block
50.26
-28.09
-35.85%
Paymentus Holdings Earnings Call Summary
Earnings Call Date: Mar 10, 2025 | % Change Since: 3.57% | Next Earnings Date: May 12, 2025
Earnings Call Sentiment Positive
The earnings call reflected a positive sentiment overall, with significant growth in revenue and adjusted EBITDA, bolstered by strong customer activity, demand, and a robust cash position. Despite some challenges in contribution margin reduction and increased operating expenses, the positive highlights substantially outweigh the lowlights.Highlights
Record-Breaking Revenue and Growth
Fourth quarter 2024 revenue was a record $257.9 million, up 56.5% year-over-year. Full year 2024 revenue increased 41.9% to $871.7 million, exceeding long-term target of 20% top-line growth.
Strong Adjusted EBITDA Growth
Fourth quarter adjusted EBITDA was $27.3 million, up 36.9% year-over-year. For the full year 2024, adjusted EBITDA increased 62.2% to $94.2 million, surpassing long-term target of 20% to 30% growth.
Robust Customer Activity and Demand
The company signed clients in various industry verticals, including insurance, government agencies, utilities, banking and others, and onboarded clients across multiple verticals.
Financial Stability and Strong Cash Position
Ended the fourth quarter 2024 with total cash of $209.4 million with no debt, and generated $19 million of free cash flow during the quarter.
Lowlights
Contribution Margin Reduction
Contribution margin for the fourth quarter was 33.4%, a decline from 40.3% in the prior-year period, due to the addition of large, high-volume enterprise billers.
Non-GAAP Operating Expenses Increase
Fourth quarter non-GAAP operating expenses increased 28.8% year-over-year to $47.3 million, primarily reflecting higher sales and marketing expenses.
Company Guidance
During the Paymentus Fourth Quarter and Full Year 2024 Earnings Conference Call, the management provided guidance for 2025, reflecting their confidence in continued growth. They reaffirmed their CAGR model, aiming for 20% revenue growth and 20% to 30% adjusted EBITDA growth. For the first quarter of 2025, revenue is expected to range from $241 million to $249 million, representing a 32.5% year-over-year growth at the midpoint. Contribution profit is projected between $84 million and $86 million, while adjusted EBITDA is forecasted to be between $24 million and $26 million. For the full year 2025, revenue is anticipated to be between $1.04 billion and $1.06 billion, marking a 20.4% growth at the midpoint. Contribution profit is expected to range from $358 million to $366 million, and adjusted EBITDA is projected to be between $112 million and $116 million. The company aims for a Rule of 40 metric ranging from 46 to 49, highlighting their focus on balancing growth and profitability.Paymentus Holdings Corporate Events
Executive/Board Changes
Paymentus Holdings Unveils 2025 Executive Compensation Plan
Neutral
Mar 19, 2025
On March 13, 2025, Paymentus Holdings, Inc. announced the adoption of its 2025 Executive Incentive Compensation Plan, following a review by the board of directors and insights from an independent compensation consultant. The plan outlines the base salary and target bonus percentages for key executives, including a 3% salary increase from 2024. The performance metrics for the plan are equally weighted and include gross revenue, non-GAAP contribution profit, Adjusted EBITDA, Adjusted EBITDA less capitalized software, and individual performance.
Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.