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Payoneer (PAYO)
NASDAQ:PAYO
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Payoneer
(NASDAQ:PAYO)
Rating:73Outperform
Price Target:
$7.50
▲(10.78%Upside)
Positive Factors
Financial Performance
Payoneer's 4Q24 revenue and adjusted EBITDA both exceeded consensus estimates, indicating strong financial performance.
Market Opportunity
The market's negative reaction to PAYO's solid 4Q24 report is seen as an attractive buying opportunity, with a reiterated Buy rating and a price target of $12.
Stock Rating
The stock rating for Payoneer Inc. has been upgraded to 'Outperform' from 'Market Perform'.
Negative Factors
Investor Concerns
Investors' concerns about the pace of volume growth in key verticals like B2B and ecommerce marketplaces have contributed to the pullback in PAYO's share price.
Revenue Headwinds
PAYO shares are down 39% year-to-date as investors are concerned about the revenue headwinds associated with lower interest rates and the impact of tariffs.
Tariffs Impact
The evolving tariff situation reduces visibility, with potential impact estimated at about $50 million to total revenues in the second half of 2025.
Payoneer (PAYO) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$2.43B
Dividend YieldN/A
Average Volume (3M)3.95M
Price to Earnings (P/E)22.6
Beta (1Y)1.37
Revenue Growth14.86%
EPS Growth-0.94%
CountryUS
Employees2,407
SectorTechnology
Sector Strength83
IndustrySoftware - Infrastructure
Share Statistics
EPS (TTM)0.05
Shares Outstanding361,671,200
10 Day Avg. Volume2,277,462
30 Day Avg. Volume3,952,249
Financial Highlights & Ratios
PEG Ratio-2.43
Price to Book (P/B)3.30
Price to Sales (P/S)0.00
P/FCF Ratio20.58
Enterprise Value/Market Cap0.79
Enterprise Value/Revenue0.52
Enterprise Value/Gross Profit2.40
Enterprise Value/Ebitda2.67
Forecast
1Y Price Target
$9.42Price Target Upside39.14% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering7
Payoneer Business Overview & Revenue Model
Company DescriptionPayoneer Global Inc. operates a payment and commerce-enabling platform that facilitates marketplaces, platforms and online merchants worldwide. It delivers a suite of services that includes cross-border payments, B2B accounts payable/accounts receivable, multi-currency account, physical and virtual Mastercard cards, working capital, merchant, tax, compliance and risk, and others. The company's platform delivers bank-grade security, stability, and redundancy combined with modern digital capabilities that interconnects the world on a single platform. Its cross-border payment solutions support an ecosystem of marketplaces and marketplace sellers to pay their sellers in approximately 190 countries and territories by connecting to Payoneer APIs and for sellers to get paid. The company was founded in 2005 and is based in New York, New York.
How the Company Makes MoneyPayoneer makes money primarily through transaction fees, currency conversion fees, and account maintenance fees. When users send or receive payments across borders, Payoneer charges a transaction fee, which is a percentage of the amount transferred. Additionally, the company earns revenue from currency conversion fees when transactions involve different currencies. Payoneer also generates income through interest on working capital solutions provided to businesses. Key partnerships with marketplaces, e-commerce platforms, and financial institutions enhance its revenue streams by expanding its user base and integrating its services into diverse ecosystems.
Payoneer Earnings Call Summary
Earnings Call Date:May 07, 2025
(Q1-2025)
| % Change Since: -5.05%|
Next Earnings Date:Aug 06, 2025
Earnings Call Sentiment Neutral
The earnings call presented a mixed outlook. While there were significant achievements in revenue growth, EBITDA margin, and geographical expansion, the uncertainty around global trade and tariffs presents a notable risk to future performance. The company is strategically positioned to navigate these challenges, but the near-term outlook remains uncertain.Q1-2025 Updates
Positive Updates
Strong Revenue Growth
Revenue grew 16% year-over-year, excluding interest income, driven by a 37% increase in B2B revenue, particularly in APAC, EMEA, and Latin America.
Record EBITDA Margin
Adjusted EBITDA was $65 million with a 27% margin, marking the highest adjusted EBITDA quarter in nearly three years and the fourth consecutive quarter of profitability net of interest.
Expansion in China and India
Payoneer closed the acquisition of a licensed China-based payment provider and applied for a Cross Border Payment Aggregator license in India.
Increased Customer Funds
Customer funds held by Payoneer increased 11% year-over-year to $6.6 billion, showcasing the value of their multi-currency capabilities.
Workforce Management Product Growth
Payoneer's workforce management product is gaining traction, showing strong growth and surpassing $1 million in new incremental AAR from newly signed deals.
Negative Updates
Impact of Global Trade Uncertainty
Recent developments related to tariffs and global trade have led to the suspension of full-year 2025 guidance, with potential revenue headwinds estimated at $50 million if the current tariff regime remains.
Challenges in Marketplace Volumes
Marketplace volumes were impacted by changes in the timing of holiday volume payouts and other marketplace-driven factors.
Increase in Operating Expenses
Total operating expenses increased by 14%, driven by higher transaction costs, labor expenses, consultancy fees, and incentives for card adoption.
Company Guidance
During the first quarter of 2025, Payoneer provided guidance with several key metrics. Revenue excluding interest income grew by 16% year-over-year, driven by strong performance in their B2B segment, which saw a 37% increase. The adjusted EBITDA reached $65 million, representing a 27% margin, and marked the fourth consecutive quarter of profitability net of interest. In terms of volume, there was a 7% increase, with SMB volume up 7% year-over-year. Notably, B2B SMBs experienced a 21% growth in volume, and merchant services volume surged by 88%. The company also reported an 11% growth in customer funds held, totaling $6.6 billion. However, due to potential impacts from tariffs and global trade uncertainties, Payoneer suspended its previously issued full-year 2025 guidance, estimating a potential $50 million revenue headwind under the current tariff regime.Payoneer Financial Statement Overview
Summary
Payoneer exhibits strong financial health with impressive revenue growth and profitability improvements. The company's robust balance sheet and solid cash flow generation further support its financial stability. While there are potential risks related to a low equity ratio, the overall trajectory suggests a positive outlook for Payoneer's financial performance.Income Statement
Payoneer has exhibited strong revenue growth with a CAGR of approximately 24% over the past five years. The gross profit margin consistently remains high at 100%, indicating effective cost control. The net profit margin has improved to 12.39% in 2024 from losses in prior years, reflecting a solid turnaround in profitability. Additionally, EBIT and EBITDA margins have shown significant improvement, signaling enhanced operational efficiency.85
Very Positive
Balance Sheet
The company maintains a robust balance sheet with zero total debt in 2024, showcasing financial prudence. The debt-to-equity ratio is favorable at 0, and the equity ratio is 9.14%, reflecting a strong equity position. Return on equity has increased to 16.72% in 2024, which is commendable. However, the relatively low equity ratio may be a potential risk factor.78
Positive
Cash Flow
Payoneer's cash flow performance is strong, with a notable free cash flow growth rate of 51% in 2024. The operating cash flow to net income ratio is 1.46, suggesting efficient cash conversion from earnings. The free cash flow to net income ratio of 1.39 further strengthens the company's cash generation capability. The company also has a healthy level of cash and cash equivalents, ensuring liquidity.80
Positive
| Breakdown | ||||
| Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|
| Income Statement | Total Revenue | |||
| 977.72M | 831.10M | 627.62M | 473.40M | 345.59M | Gross Profit |
| 825.61M | 708.81M | 517.46M | 371.93M | 248.55M | EBIT |
| 149.03M | 103.61M | -22.21M | -30.21M | -17.30M | EBITDA |
| 186.32M | 131.42M | -8.23M | -7.14M | 1.20M | Net Income Common Stockholders |
| 121.16M | 93.33M | -11.97M | -33.95M | -23.60M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | |||
| 497.47M | 617.02M | 543.30M | 465.93M | 102.99M | Total Assets |
| 7.93B | 7.28B | 6.59B | 5.08B | 3.67B | Total Debt |
| 21.38M | 43.42M | 24.50M | 13.66M | 40.02M | Net Debt |
| -476.09M | -573.60M | -518.80M | -452.26M | -62.96M | Total Liabilities |
| 7.21B | 6.62B | 6.05B | 4.59B | 3.65B | Stockholders Equity |
| 724.79M | 664.27M | 545.26M | 487.07M | 24.30M |
| Cash Flow | Free Cash Flow | |||
| 168.74M | 111.70M | 55.13M | -1.32M | -4.51M | Operating Cash Flow |
| 176.93M | 159.49M | 83.96M | 19.58M | 9.53M | Investing Cash Flow |
| -1.96B | -44.25M | 5.73M | 10.16M | -66.85M | Financing Cash Flow |
| 427.77M | 511.95M | 1.46B | 1.40B | 1.67B |
Payoneer Technical Analysis
Positive
6.77
Price Trends
6.83
Positive
8.10
Negative
8.51
Negative
Market Momentum
-0.05
Positive
49.33
Neutral
50.68
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For PAYO, the sentiment is Positive. The current price of 6.77 is below the 20-day moving average (MA) of 6.93, below the 50-day MA of 6.83, and below the 200-day MA of 8.51, indicating a neutral trend. The MACD of -0.05 indicates Positive momentum. The RSI at 49.33 is Neutral, neither overbought nor oversold. The STOCH value of 50.68 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for PAYO.
Payoneer Risk Analysis
Payoneer disclosed 41 risk factors in its most recent earnings report. Payoneer 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
Payoneer Peers Comparison
Overall Rating
UnderperformOutperform
Sector (62)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
82 Outperform | $3.03B | 22.92 | 26.10% | ― | 33.84% | 0.29% | |
74 Outperform | $3.01B | 7.43 | 14.36% | <0.01% | 2.38% | 9.88% | |
73 Outperform | $2.43B | 22.64 | 15.97% | ― | 14.86% | -0.94% | |
69 Neutral | $2.98B | ― | -11.33% | ― | 26.55% | 38.37% | |
68 Neutral | $2.51B | 53.64 | 5.01% | ― | -8.44% | ― | |
62 Neutral | $11.75B | 10.58 | -7.10% | 2.91% | 7.47% | -7.95% | |
57 Neutral | $741.07M | 39.11 | -0.04% | ― | 3.50% | 95.90% |
* Technology Sector Average
Performance Comparison
PAYO
Payoneer
6.88
0.96
16.22%
PAGS
Pagseguro Digital
8.84
-3.04
-25.59%
PSFE
Paysafe
12.46
-5.72
-31.46%
ALKT
Alkami Technology
30.44
3.55
13.20%
MQ
Marqeta
5.50
0.17
3.19%
DLO
DLocal
10.25
2.31
29.09%
Payoneer Corporate Events
Executive/Board Changes
Payoneer Expands Board with New Director Appointment
Positive
Feb 24, 2025
On February 19, 2025, Payoneer’s Board of Directors expanded from nine to ten members, appointing Barak Eilam as a Class I director. Eilam, with nearly three decades of experience in technology businesses, is expected to bring valuable insights to the company, enhancing its efforts to drive shareholder value and build a global financial stack for businesses worldwide.
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.