Priority Technology Holdings (PRTH) AI Stock Analysis

• Market Cap: $610.91M
• Dividend Yield: N/A
• Average Volume (3M): 419.20K
• Price to Earnings (P/E): ―
• Beta (1Y): 1.41
• Revenue Growth: 15.76%
• EPS Growth: 82.78%
• Country: US
• Employees: 1,005
• Sector: Technology
• Sector Strength: 78
• Industry: Software - Infrastructure
• EPS (TTM): 0.10
• Shares Outstanding: 79,753,480
• 10 Day Avg. Volume: 383,168
• 30 Day Avg. Volume: 419,204
• PEG Ratio: -0.45
• Price to Book (P/B): -3.21
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 8.55
• Enterprise Value/Market Cap: 2.32
• Enterprise Value/Revenue: 0.43
• Enterprise Value/Gross Profit: 5.60
• Enterprise Value/Ebitda: 2.02
• 1Y Price Target: $11.60
• Price Target Upside: 51.44% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 5

• Rating: 66 Neutral
• Price Target: $8.50 ▲( 10.97% Upside)

The overall stock score is primarily driven by strong financial performance and positive earnings call highlights, despite significant leverage risks and unattractive valuation metrics. Technical analysis supports a moderately positive outlook, but caution is advised due to potential overbought signals.

Positive Factors

Financial performance

Priority's shares are seen as undervalued compared to competitors, with a strong potential for price appreciation.

Revenue growth

PRTH is projected to deliver low double-digit organic revenue growth and expanding margins, benefiting from favorable business mix shifts and decreasing tax rates.

Valuation

Improved liquidity profile with expected ~10%+ y/y EBITDA growth trading at a lower multiple compared to its peer group indicates attractive valuation.

Negative Factors

Market perception

The market backdrop is understandably skeptical and that drove pressure in shares that is exacerbated by limited trading liquidity in a small-cap stock.

Revenue expectations

Revenue for Q4 is expected slightly below consensus.

Priority Technology Holdings Business Overview & Revenue Model

Company Description

Priority 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 Money

Priority Technology Holdings generates revenue through various streams, primarily from payment processing fees, software as a service (SaaS) subscriptions, and value-added services. The company earns transaction fees each time a payment is processed through its systems, making it a critical partner for businesses needing efficient and secure payment solutions. Furthermore, Priority offers subscription-based software solutions that provide businesses with tools for financial management, accounting, and customer relationship management. Additionally, the company forms strategic partnerships with financial institutions and other technology providers to expand its service offerings and market reach, thereby contributing to its revenue growth.

Priority Technology Holdings Financial Statement Overview

Summary

Priority Technology Holdings exhibits strong revenue growth but faces challenges in profitability and financial stability, particularly with negative equity and significant liabilities. Cash flow remains a positive aspect, but reliance on external financing highlights potential liquidity concerns.

Income Statement

Priority Technology Holdings shows strong revenue growth with an increase from $663.6M in 2022 to $879.7M in 2024. However, the company experiences volatility in profitability; net income remains negative despite an increase in EBIT. EBITDA margin decline from 2023 to 2024 is notable, indicating rising operational challenges.

Balance Sheet

The balance sheet reflects a concerning financial position with negative stockholders' equity in 2024, driven by significant liabilities. The debt-to-equity ratio is not meaningful due to negative equity, and the equity ratio is similarly concerning. The high level of liabilities poses a risk to financial stability.

Cash Flow

Cash flow analysis reveals positive operating cash flow and free cash flow in recent years, with a stable operating cash flow to net income ratio. However, the free cash flow growth rate is modest, and substantial financing cash flows indicate reliance on external funding.

Breakdown
Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement		Total Revenue
879.70M	755.61M	663.64M	514.90M	404.34M
	Gross Profit
328.08M	275.31M	226.89M	155.02M	126.97M
	EBIT
133.42M	81.52M	56.16M	33.09M	20.86M
	EBITDA
179.93M	151.66M	126.57M	82.31M	167.57M
	Net Income Common Stockholders
24.02M	-1.31M	-2.15M	1.39M	71.06M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
58.60M	39.60M	18.45M	20.30M	9.24M
	Total Assets
1.83B	1.62B	1.37B	1.35B	417.83M
	Total Debt
930.39M	638.68M	605.13M	610.30M	377.31M
	Net Debt
871.79M	599.07M	586.67M	590.00M	368.07M
	Total Liabilities
1.99B	1.50B	1.24B	1.21B	516.39M
	Stockholders Equity
-166.84M	110.89M	131.54M	145.92M	-98.56M
Cash Flow		Free Cash Flow
63.92M	60.00M	51.64M	-49.80M	34.05M
	Operating Cash Flow
85.61M	81.26M	70.52M	9.38M	47.07M
	Investing Cash Flow
-35.55M	-55.75M	-36.50M	-451.03M	166.40M
	Financing Cash Flow
147.58M	210.10M	8.50M	871.63M	-175.81M

Priority Technology Holdings Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 7.66
• 50DMA: Positive
• 100DMA: Negative
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: 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 7.66 is above the 20-day moving average (MA) of 7.30, above the 50-day MA of 7.22, and below the 200-day MA of 7.79, indicating a neutral trend. The MACD of 0.07 indicates Negative momentum. The RSI at 55.15 is Neutral, neither overbought nor oversold. The STOCH value of 56.48 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for PRTH.

Priority Technology Holdings Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
PAYS	75 Outperform	$183.26M	30.81	18.82%	―	26.77%	-13.24%
OSPN	72 Outperform	$604.23M	10.74	28.92%	0.76%	-0.26%	―
IMXI	71 Outperform	$319.85M	6.30	39.27%	―	-1.90%	0.05%
PRTH	66 Neutral	$610.91M	―	57.39%	―	15.76%	82.78%
Sector *	61 Neutral	$11.28B	10.16	-6.88%	2.97%	7.41%	-8.93%
RPAY	61 Neutral	$409.23M	―	-1.64%	―	2.26%	85.37%
BKKT	51 Neutral	$148.30M	―	-60.94%	―	128.83%	73.67%

Priority Technology Holdings Corporate Events

Priority Technology Holdings Reports Q1 2025 Revenue Growth

On May 6, 2025, Priority Technology Holdings announced its financial results for the first quarter of 2025, reporting a 9.2% increase in revenue to $224.6 million compared to the previous year. The company highlighted strong growth across its unified commerce platform, with significant increases in adjusted gross profit and operating income, reinforcing its market position despite economic uncertainties.

Priority Technology Holdings Announces Board Changes

On February 26, 2025, John V. Priore announced his resignation from the Board of Priority Technology Holdings, effective April 1, 2025. His departure was not due to any disagreements with the company. Clayton Main, an experienced executive with over 20 years in leveraged financing and structured equity investments, will replace Priore on the board. Main’s appointment is expected to bring valuable expertise to Priority as it seeks to optimize its capital structure and explore growth in new enterprise payment verticals.