Kwanchanok Taen-on
- Keefe, Bruyette & Woods starts coverage of Pagaya Technologies (NASDAQ:PGY) with an Outperform rating as the digital marketplace for lenders and funding partners helps large originators of personal and auto loans and maintain customer relationships.
- “The most critical part of our Outperform thesis is that our channel checks suggest that lenders extract significant value through their relationship with PGY,” analyst Sanjay Sakhrani wrote in a note to clients. “This is not only because it allows them to make more loans but also allows them to maintain a relationship with that customer despite not being the credit provider of the loan.”
- In addition, the company is “on a path to being cash flow positive in 2025.”
- The company works with 30 lending partners, such as Ally (ALLY), SoFi (SOFI), and U.S. Bank (USB), and provides AI-powered underwriting technology for secondary review of applicants that weren’t directly approved by these platforms. If approved, those loans are then funded by third-party investors.
- KBW’s Outperform clashes with the SA Quant rating of Sell and agrees with the average SA Analyst rating and average Wall Street rating, both at Buy.
