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PaySign (PAYS)
NASDAQ:PAYS
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PaySign
(NASDAQ:PAYS)
70Outperform
Positive Factors
Earnings
Paysign reported better than expected Q4/24 financial results with a revenue increase of 14% to $15.6 million and an adjusted EBITDA increase of 14% to $2.86 million.
Financial Performance
The company's 3Q24 results beat consensus on revenue, adjusted EBITDA, and EPS due to the increase in pharma patient affordability programs with higher gross margins.
Growth Potential
The launch of a cornerstone account with AstraZeneca has led to a strong rebound in pharma revenue and improved gross margins.
Negative Factors
Plasma Revenue
Plasma revenue declined by 6.2% to $10.8 million due to a decrease in plasma donations and dollars loaded to cards, as plasma inventory levels have normalized.
Revenue Decline
Following a difficult pandemic-era environment that led to declining pharma revenue, Paysign has seen a strong rebound after launching cornerstone account AstraZeneca in Q3'23.
Valuation Concerns
Shares trading at a lower revenue multiple compared to the comp group median suggest catalytic growth potential is not fully reflected in the current valuation.
PaySign (PAYS) vs. S&P 500 (SPY)
Market Cap
$125.23M
Dividend YieldN/A
Average Volume (3M)244.09K
Price to Earnings (P/E)36.4
Beta (1Y)1.25
Revenue Growth23.50%
EPS Growth-41.63%
CountryUS
Employees173
SectorTechnology
Sector Strength67
IndustrySoftware - Infrastructure
Share Statistics
EPS (TTM)0.02
Shares Outstanding53,747,673
10 Day Avg. Volume142,209
30 Day Avg. Volume244,090
Financial Highlights & Ratios
PEG RatioN/A
Price to Book (P/B)N/A
Price to Sales (P/S)0.00
Price to Cash Flow (P/CF)0.00
P/FCF Ratio0.00
Enterprise Value/Market Cap0.39
Enterprise Value/RevenueN/A
Enterprise Value/Gross Profit1.50
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
$6.00Price Target Upside150.00% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering4
PaySign Business Overview & Revenue Model
Company DescriptionPaySign, Inc. provides prepaid card products and processing services under the PaySign brand for corporate, consumer, and government applications. It offers various services, such as transaction processing, cardholder enrollment, value loading, cardholder account management, reporting, and customer service through PaySign, a proprietary card-processing platform. The company also develops prepaid card programs for corporate incentive and rewards, including consumer rebates, donor compensation, clinical trials, healthcare reimbursement payments, and pharmaceutical payment assistance; and payroll or general purpose reloadable cards, as well as gift or incentive cards. In addition, it offers and Per Diem/Corporate Expense Payments that allows businesses, and nonprofits and government agencies the ability to control employee spending while reducing administration costs by eliminating the need for traditional expense reports. Further, the company provides payment claims processing and other administrative services; pharmacy-based voucher and copay, and medical claims and debit-based affordability programs; PaySign Premier, a demand deposit account debit card; and payment solution for source plasma collection centers, as well as customer service center and PaySign Communications Suite services. Its principal target markets for processing services comprise prepaid card issuers, retail and private-label issuers, small third-party processors, and small and mid-size financial institutions in the United States and Mexico. The company was formerly known as 3PEA International, Inc. and changed its name to PaySign, Inc. in April 2019. PaySign, Inc. was incorporated in 1995 and is based in Henderson, Nevada.
How the Company Makes MoneyPaySign generates revenue primarily through fees associated with its prepaid card programs. The company charges clients for card issuance, transaction processing, and program management services. Additionally, PaySign earns income from interchange fees, which are collected from merchants when cardholders use their prepaid cards for purchases. The company also benefits from interest and service fees related to funds loaded onto prepaid cards. Key partnerships with pharmaceutical companies, healthcare providers, and corporate clients contribute significantly to PaySign's earnings by expanding its customer base and enhancing its service offerings.
PaySign Financial Statement Overview
Summary
PaySign demonstrates strong revenue growth and improving operational efficiency. Despite some pressure on net profitability, the company maintains a healthy balance sheet with low leverage and strong cash flows, positioning it well for future growth and stability. However, the relatively low net profit margin and stockholders' equity warrant careful monitoring to ensure long-term financial health.Income Statement
PaySign showed a strong revenue growth of 23.5% over the past year, indicating a positive trajectory. The gross profit margin stands at 55.1%, which is solid for the industry. However, the net profit margin has decreased to 6.5% from 13.7% last year, indicating some profitability pressure. The EBIT margin has improved to 1.7%, recovering from negative figures in prior years, showing signs of operational improvement.―
Balance Sheet
The debt-to-equity ratio is low at 0.1, indicating minimal leverage, which is beneficial for financial stability. Return on equity is 12.5%, showing reasonable profitability relative to shareholder equity. The equity ratio is 17%, which is moderate and suggests a balanced capital structure. However, the stockholders' equity is relatively low compared to total liabilities, indicating potential risk if liabilities increase.70
Cash Flow
Operating cash flow increased to $22.9 million, showcasing robust cash generation capabilities. Free cash flow also showed growth, which is a positive sign for future investments and debt servicing. The operating cash flow to net income ratio is high at 6.0, indicating strong cash conversion efficiency. The free cash flow to net income ratio is 5.9, reinforcing the company's strong cash position relative to earnings.―
| Breakdown | ||||
| Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|
| Income Statement | Total Revenue | |||
| 58.38M | 47.27M | 38.03M | 29.46M | 24.12M | Gross Profit |
| 32.20M | 24.14M | 20.95M | 14.71M | 9.30M | EBIT |
| 1.02M | -167.25K | 344.33K | -2.74M | -7.91M | EBITDA |
| 10.13M | 3.86M | 3.25M | -213.22K | -5.79M | Net Income Common Stockholders |
| 3.82M | 6.46M | 1.03M | -2.72M | -9.14M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | |||
| 10.77M | 16.99M | 9.71M | 7.39M | 7.83M | Total Assets |
| 179.03M | 146.60M | 108.24M | 84.05M | 67.83M | Total Debt |
| 2.93M | 3.31M | 3.67M | 4.01M | 4.33M | Net Debt |
| -7.84M | -13.68M | -6.04M | -3.37M | -3.50M | Total Liabilities |
| 148.59M | 122.11M | 91.95M | 71.06M | 54.60M | Stockholders Equity |
| 30.44M | 24.49M | 16.29M | 12.99M | 13.24M |
| Cash Flow | Free Cash Flow | |||
| 22.51M | 20.57M | 21.23M | 12.55M | 10.43M | Operating Cash Flow |
| 22.95M | 27.62M | 25.32M | 15.23M | 13.78M | Investing Cash Flow |
| -9.49M | -7.05M | -4.09M | -2.68M | -3.34M | Financing Cash Flow |
| -466.25K | -1.12M | 0.00 | 192.14K | -72.86K |
PaySign Technical Analysis
Neutral
2.40
Price Trends
2.31
Positive
2.62
Negative
3.39
Negative
Market Momentum
0.03
Negative
60.98
Neutral
72.98
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For PAYS, the sentiment is Neutral. The current price of 2.4 is above the 20-day moving average (MA) of 2.20, above the 50-day MA of 2.31, and below the 200-day MA of 3.39, indicating a neutral trend. The MACD of 0.03 indicates Negative momentum. The RSI at 60.98 is Neutral, neither overbought nor oversold. The STOCH value of 72.98 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for PAYS.
PaySign Risk Analysis
PaySign disclosed 28 risk factors in its most recent earnings report. PaySign 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
PaySign Peers Comparison
Overall Rating
UnderperformOutperform
Sector (60)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
74 Outperform | $2.61B | 22.10 | 17.45% | ― | 17.64% | 30.75% | |
70 Outperform | $125.23M | 36.35 | 13.89% | ― | 23.50% | -41.63% | |
70 Outperform | $379.78M | 6.90 | 41.43% | ― | -0.20% | 8.56% | |
60 Neutral | $10.93B | 10.46 | -6.70% | 2.99% | 7.54% | -12.22% | |
54 Neutral | $622.08M | ― | 57.39% | ― | 16.42% | 50.85% | |
47 Neutral | $138.11M | ― | -113.56% | ― | 347.52% | 62.22% | |
42 Neutral | $30.56M | ― | 86.76% | ― | 11.25% | 34.57% |
* Technology Sector Average
Performance Comparison
PAYS
PaySign
2.40
-2.27
-48.61%
IMXI
International Money Express
12.39
-7.20
-36.75%
PRTH
Priority Technology Holdings
6.90
3.46
100.58%
KPLT
Katapult Holdings
7.30
-7.33
-50.10%
PAYO
Payoneer
7.13
1.91
36.59%
BKKT
Bakkt Holdings, Inc. Class A
9.12
1.83
25.10%
PaySign Earnings Call Summary
Earnings Call Date:Mar 25, 2025
(Q4-2024)
| % Change Since: -3.23%|
Next Earnings Date:May 08, 2025
Earnings Call Sentiment Neutral
The earnings call indicated strong growth in the patient affordability business and strategic expansion through acquisitions, which were partly offset by challenges in the plasma business and increased operating expenses. The overall sentiment is balanced with significant achievements in revenue growth and strategic initiatives, but also notable challenges in specific segments.Q4-2024 Updates
Positive Updates
Strong Revenue Growth
For the full year 2024, revenue increased by 23.5% to $58.4 million, and adjusted EBITDA increased 43.3% to $9.6 million. Adjusted EBITDA margins improved by 230 basis points to 16.5%.
Patient Affordability Business Success
The patient affordability segment grew 212% year-over-year, reaching $12.7 million in revenue compared to $4.1 million in 2023. Claims processed increased by 272%, and 33 net programs were added, representing a 77% increase over the previous year.
Strategic Acquisition
Paysign announced the acquisition of Gamma Innovation LLC, enhancing their capability to offer integrated solutions for plasma donor and pharmaceutical patient engagement, and marking their entry into the high-margin software-as-a-service market.
Strong Financial Position
Paysign exited the year with $10.8 million in unrestricted cash and zero debt.
Negative Updates
Plasma Business Challenges
Plasma revenue for the fourth quarter was down 6.2%, driven by fractionators working through an oversupply of source plasma and increased donation yields leading to reduced donor compensation payments.
Increase in Operating Expenses
SG&A for the quarter increased 36.7% to $6.3 million, and total operating expenses increased 34.2% to $8.7 million, attributed to investments in IT and personnel.
Decline in Net Income
Net income for the fourth quarter was $1.4 million or $0.02 per fully diluted share, compared to $5.6 million or $0.05 per share in the same period last year.
Company Guidance
In the Paysign, Inc. earnings call for the fourth quarter and full year 2024, significant guidance was provided, emphasizing several key financial metrics and projections. The company reported an impressive 23.5% increase in full-year revenue, reaching $58.4 million, alongside a 43.3% rise in adjusted EBITDA to $9.6 million, with adjusted EBITDA margins improving by 230 basis points to 16.5%. The patient affordability segment emerged as a primary growth driver, boasting a 212% increase in annual revenue to $12.7 million, a 272% rise in claims processed, and a 77% growth in net programs added. For 2025, Paysign anticipates a continuation of this momentum, projecting a doubling of revenue in the patient affordability business. However, the plasma donor compensation business experienced a modest 4.6% revenue increase, with challenges expected to persist due to oversupply issues. Paysign plans to add 10 to 15 new plasma centers in 2025. The company's initial guidance for 2025 projects total revenues between $68.5 million and $70 million, with plasma revenue comprising approximately 57.5% of the total. Gross profit margins are anticipated to be between 62% and 64%, and adjusted EBITDA is forecasted to range from $12.5 million to $13.5 million. The strategic acquisition of Gamma Innovation LLC is also expected to enhance Paysign's capabilities and expand its total addressable market, although its revenue contributions are not yet fully incorporated into the 2025 guidance.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.