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Priority Technology Holdings Inc (PRTH)
NASDAQ:PRTH
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Priority Technology Holdings (PRTH) AI Stock Analysis

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PRTH

Priority Technology Holdings

(NASDAQ:PRTH)

Rating:65Neutral
Price Target:
$8.50
▲(1.55% Upside)
Priority Technology Holdings' overall score reflects strong earnings call performance and positive technical indicators. However, financial leverage risks and high valuation constrain the score. Recent corporate events provide additional support for growth.
Positive Factors
Financial Performance
PRTH delivered a solid 2Q, beating across revenue, gross profit, and EBITDA, reflecting good execution amid mostly stable trends.
Strategic Positioning
The company's debt raise offers added flexibility, lowering interest expense and providing opportunities for strategic acquisitions.
Negative Factors
Growth Challenges
1Q performance was mixed versus Street, largely due to lighter SMB Merchant growth, leaving a more pronounced ramp to achieve its affirmed CY25 outlook.
Market Skepticism
The market backdrop is understandably skeptical and that drove pressure in shares that is exacerbated by limited trading liquidity in a small-cap stock.

Priority Technology Holdings (PRTH) vs. SPDR S&P 500 ETF (SPY)

Priority Technology Holdings Business Overview & Revenue Model

Company DescriptionPriority Technology Holdings, Inc. operates as a payment technology company in the United States. It operates through three segments: Small and Medium-Sized Businesses (SMB) Payments, Business-To-Business Payments, and Enterprise Payments. The company offers MX product line, including MX Connect and MX Merchant products, such as MX Insights, MX Storefront, MX Retail, MX Invoice, MX B2B and ACH.com, and others, which provides flexible and customizable set of business applications that helps to manage critical business work functions and revenue performance to resellers and merchant clients using core payment processing as our leverage point. It also offers CPX, a platform that offers accounts payable automation solutions, including virtual card, purchase card, ACH +, dynamic discounting, or check. In addition, the company provides curated managed services and a suite of integrated accounts payable automation solutions to various financial institutions and card networks; and payment-adjacent technologies to facilitate the acceptance of electronic payments from customers. Further, it offers embedded payment and banking solutions to enterprise customers to modernize legacy platforms and accelerate software partners' strategies to monetize payments; and managed services solutions that provide audience-specific programs for institutional partners and other third parties; and consulting and development solutions. The company serves SMB, and enterprises, as well as distribution partners, including retail and wholesale independent sales organizations, financial institutions, and independent software vendors. Priority Technology Holdings, Inc. was founded in 2005 and is headquartered in Alpharetta, Georgia.
How the Company Makes MoneyPriority Technology Holdings generates revenue primarily through its payment processing services, which include transaction fees charged to merchants for processing credit and debit card transactions. The company also earns income through value-added services such as fraud prevention, data analytics, and customer loyalty programs. Additionally, PRTH has established partnerships with various financial institutions and technology providers, which contribute to its revenue by expanding its service offerings and customer base. Key revenue streams include fees from transaction processing, subscription fees for value-added services, and commissions from referral partnerships, all of which are supported by the increasing demand for digital payment solutions in an evolving marketplace.

Priority Technology Holdings Earnings Call Summary

Earnings Call Date:Aug 07, 2025
(Q2-2025)
|
% Change Since: |
Next Earnings Date:Nov 06, 2025
Earnings Call Sentiment Positive
Priority Technology Holdings demonstrated strong financial performance with significant revenue and profit growth across key segments, successfully refinanced debt on favorable terms, and revised financial guidance upwards. However, challenges remain in the SMB segment and macroeconomic headwinds persist.
Q2-2025 Updates
Positive Updates
Strong Financial Performance
Priority Technology Holdings reported a 9% increase in net revenue, a 13% increase in adjusted gross profit, and a 9% improvement in adjusted EBITDA for Q2 2025. Adjusted EPS increased by $0.15 year-over-year to $0.26.
Increase in Customer Accounts and Transaction Volume
The company ended Q2 2025 with over 1.6 million total customer accounts, up from 1.3 million in the previous quarter. Annual transaction volume increased by nearly $5 billion to $140 billion.
Revenue Growth in Key Segments
B2B revenue grew over 14%, and Enterprise revenue grew over 20% year-over-year, contributing to an overall margin expansion.
Successful Refinancing of Debt
Priority refinanced existing debt on favorable terms, including a $1 billion 7-year term loan, saving $7 million in annual interest expenses.
Revised Financial Guidance
The company narrowed its full-year revenue guidance to $970 million to $990 million and adjusted EBITDA to $222.5 million to $227.5 million, indicating confidence in continued growth.
Negative Updates
Challenges in SMB Segment
SMB segment faced headwinds from lower specialized acquiring revenue and the attrition of historical residual purchases, impacting gross margins and adjusted EBITDA.
Increased Operating Expenses
Salaries and benefits increased by 22.3%, and SG&A expenses rose by 24% year-over-year, attributed to higher stock compensation, increased headcount, and software expenses.
Macroeconomic Headwinds
The company noted ongoing challenges from tariffs and government cuts, affecting same-store sales and creating economic uncertainty.
Company Guidance
During the second quarter of 2025 earnings call, Priority Technology Holdings reported robust financial metrics, reinforcing its strong revenue and adjusted EBITDA guidance for the year. The company achieved a 9% increase in net revenue, a 13% growth in adjusted gross profit, and a 9% rise in adjusted EBITDA. Additionally, adjusted EPS rose by $0.15 year-over-year to $0.26. The company ended the quarter with over 1.6 million customer accounts and an annual transaction volume increase of nearly $5 billion, reaching $140 billion. The guidance for full-year revenue was narrowed to a range of $970 million to $990 million, with adjusted EBITDA expectations refined to between $222.5 million and $227.5 million. Priority's B2B and Enterprise segments contributed significantly, with B2B revenue growing over 14% and Enterprise revenue up 20% year-over-year. The company highlighted its strategic initiatives, including a new $1 billion term loan and a $100 million revolving credit facility, which will aid in reducing interest expenses and supporting growth initiatives.

Priority Technology Holdings Financial Statement Overview

Summary
Priority Technology Holdings shows strong revenue growth and improving profitability, with a TTM revenue increase of 18.5% and improved gross profit margins. However, the balance sheet reveals significant leverage risks due to negative equity, and cash flow is stable but limited in cash generation relative to earnings.
Income Statement
75
Positive
The company demonstrated strong revenue growth, with a TTM increase of 18.5% from 2023 to 2024. Gross profit margin improved to 33.57% in TTM, indicative of effective cost management. Net profit margin is relatively low at 3.08%, though it has improved from negative in previous years, indicating better profitability management. EBIT and EBITDA margins are healthy, showing operational efficiency.
Balance Sheet
50
Neutral
Priority Technology Holdings shows a concerning debt-to-equity ratio due to negative equity, indicating high leverage risk. The company's equity ratio is negative, reflecting its poor capital structure. However, the return on equity is not meaningful due to the negative equity, making profitability analysis challenging.
Cash Flow
65
Positive
The company has shown a stable free cash flow, with a positive trend in operating cash flow. However, the free cash flow to net income ratio is low, indicating limited cash generation relative to earnings. The operating cash flow to net income ratio is strong, reflecting good cash conversion from operations.
BreakdownTTMDec 2024Dec 2023Dec 2022Dec 2021Dec 2020
Income Statement
Total Revenue918.56M879.70M755.61M663.64M514.90M404.34M
Gross Profit308.45M328.08M275.31M226.89M155.02M126.97M
EBITDA195.26M184.27M151.66M126.57M82.31M167.57M
Net Income37.61M24.02M-1.31M-2.15M1.39M71.06M
Balance Sheet
Total Assets2.03B1.83B1.62B1.37B1.35B417.83M
Cash, Cash Equivalents and Short-Term Investments64.77M58.60M39.60M18.45M20.30M9.24M
Total Debt921.27M930.39M638.68M605.13M610.30M377.31M
Total Liabilities2.17B1.99B1.50B1.24B1.21B516.39M
Stockholders Equity-146.12M-166.84M110.89M131.54M145.92M-98.56M
Cash Flow
Free Cash Flow47.72M63.92M60.00M51.64M-49.80M34.05M
Operating Cash Flow70.68M85.61M81.26M70.52M9.38M47.07M
Investing Cash Flow-36.09M-35.55M-55.75M-36.50M-451.03M166.40M
Financing Cash Flow307.52M147.58M210.10M8.50M871.63M-175.81M

Priority Technology Holdings Technical Analysis

Technical Analysis Sentiment
Positive
Last Price8.37
Price Trends
50DMA
7.63
Positive
100DMA
7.57
Positive
200DMA
8.43
Negative
Market Momentum
MACD
0.27
Negative
RSI
61.25
Neutral
STOCH
77.44
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For PRTH, the sentiment is Positive. The current price of 8.37 is above the 20-day moving average (MA) of 7.77, above the 50-day MA of 7.63, and below the 200-day MA of 8.43, indicating a neutral trend. The MACD of 0.27 indicates Negative momentum. The RSI at 61.25 is Neutral, neither overbought nor oversold. The STOCH value of 77.44 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for PRTH.

Priority Technology Holdings Risk Analysis

Priority Technology Holdings disclosed 30 risk factors in its most recent earnings report. Priority Technology 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

Priority Technology Holdings Peers Comparison

Overall Rating
UnderperformOutperform
Sector (54)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
70
Outperform
$579.66M9.9728.45%2.38%-2.79%259.00%
69
Neutral
$430.42M8.8536.15%-4.19%-3.52%
69
Neutral
$282.06M42.7419.65%27.84%-13.78%
65
Neutral
$668.91M32.1757.39%12.86%
58
Neutral
$514.08M-15.33%1.45%-28.78%
54
Neutral
$297.71M3.07-5.40%2.71%5.76%-75.96%
43
Neutral
$189.00M-70.04%111.83%73.52%
* Technology Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
PRTH
Priority Technology Holdings
8.37
2.50
42.59%
OSPN
OneSpan
15.12
0.02
0.13%
IMXI
International Money Express
14.50
-3.63
-20.02%
RPAY
Repay Holdings
5.92
-2.42
-29.02%
PAYS
PaySign
5.18
0.55
11.88%
BKKT
Bakkt Holdings, Inc. Class A
8.77
-4.27
-32.75%

Priority Technology Holdings Corporate Events

Private Placements and FinancingM&A Transactions
Priority Technology Holdings Acquires Boom Commerce Assets
Positive
Aug 19, 2025

On August 18, 2025, Priority Technology Holdings, Inc. announced the acquisition of Boom Commerce’s payment processing assets and secured a $50 million financing facility. The acquisition is expected to enhance Priority’s direct sales channel and provide approximately $5 million in incremental revenue in 2025. The financing facility will support Priority’s expansion into alternative financing solutions, offering flexibility to its reseller base and reinforcing its market positioning.

Business Operations and StrategyFinancial Disclosures
Priority Technology Holdings Reports Strong Q2 2025 Results
Positive
Aug 7, 2025

On August 7, 2025, Priority Technology Holdings announced its second quarter 2025 financial results, highlighting a strong year-over-year revenue growth of 9.1% and a 13% increase in adjusted gross profit. The company reported significant growth in its B2B and Enterprise segments and raised its full-year revenue guidance to a range of $970 million to $990 million. The results reflect Priority’s successful positioning in the market and its ability to provide comprehensive payment and banking solutions, with a notable increase in recurring revenue contributing to 62% of total adjusted gross profit.

Private Placements and FinancingBusiness Operations and Strategy
Priority Technology Holdings Secures $1.1 Billion Credit Facilities
Positive
Aug 4, 2025

On July 31, 2025, Priority Technology Holdings, Inc. announced the successful closing of $1.1 billion in new senior credit facilities, consisting of a $1 billion term loan with a 7-year maturity and a $100 million revolving credit facility with a 5-year maturity. This refinancing effort, which lowered the interest rate on the term loan by 100 basis points, aims to refinance existing debt, fund strategic growth initiatives, and enhance financial flexibility, thereby strengthening the company’s balance sheet and cash flow.

Private Placements and FinancingBusiness Operations and Strategy
Priority Technology Launches New Senior Credit Facilities
Positive
Jul 8, 2025

On July 8, 2025, Priority Technology Holdings announced the launch of new senior credit facilities, comprising a $70 million revolving credit facility and a $1 billion term loan. These facilities aim to refinance existing debt, partially finance a prospective acquisition, and settle considerations related to a prior acquisition. The initiative aligns with the company’s strategy to optimize its capital structure, supported by favorable debt market conditions and recent positive ratings from Moody’s and S&P. The transactions are expected to close in the third quarter of 2025, potentially impacting the company’s financial operations and market positioning.

Executive/Board ChangesShareholder Meetings
Priority Technology Holdings Holds Annual Stockholders Meeting
Neutral
Jun 13, 2025

On June 13, 2025, Priority Technology Holdings, Inc. conducted its annual stockholders meeting with 80.3% of shares represented. Key outcomes included the election of directors, approval of amendments to the Employee Stock Purchase Plan, endorsement of executive compensation, and the ratification of Ernst & Young LLP as the accounting firm for 2025.

Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

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.Date of analysis: Aug 20, 2025