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Paysafe (PSFE)
NYSE:PSFE
US Market

Paysafe (PSFE) AI Stock Analysis

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PS

Paysafe

(NYSE:PSFE)

57Neutral
Paysafe's overall stock score reflects a mix of steady revenue growth and improved profitability, tempered by high leverage and valuation concerns. The technical analysis suggests bearish momentum, while the earnings call provides a cautiously optimistic outlook with potential for organic growth acceleration. The lack of corporate events further underscores a need for strategic focus on managing financial risks and enhancing market position.
Positive Factors
Sales Pipeline
Paysafe's new sales pipeline remains promising with new product initiatives showing early signs of traction.
Valuation
Paysafe is trading at a significant discount to its peers, with an 18% FY1 EV/EBITDA discount compared to a 4% median discount over the last four years.
Negative Factors
Debt
The net debt to equity ratio is notably high at 244.2%.
Financial Performance
Adjusted EBITDA of $95 million was down 15% year-over-year, with margins decreasing due to lower gross margin and business mix.
Stock Volatility
The stock's 52-week range shows significant volatility between $12.02 and $26.25.

Paysafe (PSFE) vs. S&P 500 (SPY)

Paysafe Business Overview & Revenue Model

Company DescriptionPaysafe Limited provides digital commerce solutions to online businesses, small and medium-sized business merchants, and consumers through its Paysafe Network worldwide. The company operates in two segments, US Acquiring and Digital Commerce. It provides PCI-compliant payment acceptance and transaction processing solutions for merchants and integrated service providers, including merchant acquiring, transaction processing, online solutions, fraud and risk management tools, data and analytics, and point of sale systems and merchant financing solutions under the Paysafe and Petroleum Card Services brands. The company also offers digital wallet solutions under the Skrill and NETELLER brands; and pay-by-bank solution under the Rapid Transfer brand. In addition, it provides eCash solutions, such as Paysafecash, a bill payment eCash solution that allow users to shop online and then pay offline in cash to finalize the transaction; paysafecard, a prepaid eCash solution; and paysafecard prepaid Mastercard that can be linked to a digital paysafecard account and used to make purchases. Further, it offers integrated and ecommerce solutions for online merchants and software-integrated merchants within integrated payment capabilities; online toolkit that allows merchants and integrated software vendor to build and scale their online commerce presence; and turn-key payments gateway solution that offers critical connectivity between merchant online sites and payment acceptance and transaction processing providers. Additionally, the company manages and provides various connections to card processing networks, acquiring banks, and transaction processors; and offers gateway connectivity,? shopping cart, tokenization and encryption, fraud and risk management, and support to payment alternatives, as well as provides integrations into eCommerce platforms and multiple alternative payment methods. Paysafe Limited is based in London, the United Kingdom.
How the Company Makes MoneyPaysafe generates revenue primarily through transaction fees charged to its business clients for payment processing services. This includes fees for facilitating credit card payments, digital wallet transactions, and alternative payment methods. The company's digital wallets, such as Skrill and Neteller, provide additional revenue streams through currency conversion fees, withdrawal fees, and other service charges. Paysafe also earns money from its online cash solutions, like Paysafecard, which enable consumers to make online purchases without needing a bank account or credit card. Significant partnerships with merchants, financial institutions, and technology providers enhance its service offerings and expand its market reach, contributing to its overall earnings.

Paysafe Financial Statement Overview

Summary
Paysafe has shown steady revenue growth and improved profitability. However, its high leverage poses a financial risk, and the growth in free cash flow is limited. Managing debt levels is crucial for long-term stability.
Income Statement
65
Positive
Paysafe's revenue has shown a steady growth trajectory, increasing from $1.42 billion in 2020 to $1.70 billion in 2024. The gross profit margin remains strong at 58%, while the net profit margin improved to 1.3% in 2024 from negative values in previous years. Despite this, EBIT and EBITDA margins reveal moderate profitability. The revenue growth rate between 2023 and 2024 was approximately 6.5%, reflecting stable growth.
Balance Sheet
55
Neutral
Paysafe's balance sheet reveals a high debt-to-equity ratio of 2.74, suggesting significant leverage, which poses financial risks. The equity ratio is relatively low at 18.3%, indicating a higher dependence on liabilities. However, the return on equity (ROE) improved to 2.52% in 2024, showing a positive yet modest return on shareholders' capital.
Cash Flow
60
Neutral
The cash flow statement indicates a stable operating cash flow, with a free cash flow growth rate of 1.1% from 2023 to 2024. The operating cash flow to net income ratio is healthy, suggesting efficient cash generation relative to net income. However, the free cash flow to net income ratio is lower, reflecting reduced cash available after capital expenditures.
Breakdown
Dec 2024Dec 2023Dec 2022Dec 2021Dec 2020
Income StatementTotal Revenue
1.70B1.60B1.50B1.49B1.43B
Gross Profit
989.07M673.78M882.11M887.24M891.67M
EBIT
133.35M166.36M164.56M320.42M150.26M
EBITDA
429.58M435.88M-1.52B241.28M257.60M
Net Income Common Stockholders
22.16M-20.25M-1.86B-110.33M-126.71M
Balance SheetCash, Cash Equivalents and Short-Term Investments
216.68M202.32M260.22M313.44M387.62M
Total Assets
4.81B5.23B5.96B7.27B7.41B
Total Debt
2.41B2.53B2.68B2.80B3.31B
Net Debt
2.19B2.32B2.42B2.48B2.92B
Total Liabilities
3.93B4.34B5.10B4.56B5.48B
Stockholders Equity
879.26M883.31M859.64M2.57B1.92B
Cash FlowFree Cash Flow
133.31M131.85M774.03M76.72M322.19M
Operating Cash Flow
253.80M234.02M924.08M224.47M409.11M
Investing Cash Flow
-108.38M-135.24M-575.59M-411.27M-51.22M
Financing Cash Flow
-280.80M-771.03M-80.54M483.28M-75.47M

Paysafe Technical Analysis

Technical Analysis Sentiment
Negative
Last Price12.71
Price Trends
50DMA
15.29
Negative
100DMA
16.97
Negative
200DMA
18.95
Negative
Market Momentum
MACD
-0.56
Positive
RSI
35.27
Neutral
STOCH
3.67
Positive
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For PSFE, the sentiment is Negative. The current price of 12.71 is below the 20-day moving average (MA) of 14.75, below the 50-day MA of 15.29, and below the 200-day MA of 18.95, indicating a bearish trend. The MACD of -0.56 indicates Positive momentum. The RSI at 35.27 is Neutral, neither overbought nor oversold. The STOCH value of 3.67 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for PSFE.

Paysafe Risk Analysis

Paysafe disclosed 49 risk factors in its most recent earnings report. Paysafe 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

Paysafe 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
$3.59B14.086.34%2.31%21.67%-17.91%
PAPAY
73
Outperform
$4.87B98.2810.80%47.78%74.61%
69
Neutral
$1.38B402.840.63%20.97%
AIAI
63
Neutral
$3.21B-32.07%23.79%4.10%
60
Neutral
$11.59B10.39-7.23%2.94%7.46%-10.76%
57
Neutral
$754.13M39.11-0.04%3.50%95.90%
* Technology Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
PSFE
Paysafe
12.71
-5.18
-28.95%
CNXC
Concentrix
56.22
-8.24
-12.78%
AI
C3ai
24.16
-2.35
-8.86%
FLYW
Flywire
11.36
-5.44
-32.38%
PAY
Paymentus Holdings
38.93
20.32
109.19%

Paysafe Earnings Call Summary

Earnings Call Date:May 13, 2025
(Q1-2025)
|
% Change Since: -21.78%|
Next Earnings Date:Aug 19, 2025
Earnings Call Sentiment Neutral
The earnings call for Paysafe's Q1 2025 reflected a balanced performance. While there were notable achievements such as strong organic revenue growth, successful enterprise sales, and significant new product launches and partnerships, there were also challenges, including declines in adjusted EBITDA and revenue, as well as growth challenges in the SMB segment.
Q1-2025 Updates
Positive Updates
Organic Revenue Growth
Paysafe reported an organic revenue growth of 5% in Q1 2025, driven by strong growth from existing customers and new sales initiatives.
Enterprise Sales Success
In Q1, Paysafe signed over 100 enterprise-level contracts, which were broad-based across gaming, Latin America, and broader e-commerce within core verticals.
E-commerce Growth
E-commerce growth continued to be strong at 31% for the first quarter, with processing growth in iGaming up over 50% year-over-year.
New Product Launch in Latin America
Launched PagoEfectivo wallet in Peru, a leading cash and bank transfer payment solution, marking Paysafe's expansion in the high-growth Latin American payments landscape.
Partnership Expansion
Expanded partnerships with Fiserv and Tilled, enhancing product offerings like Clover Capital Solution for SMBs and PayFac solutions for ISVs in the US and Canada.
Negative Updates
Decline in Adjusted EBITDA
Adjusted EBITDA was $95 million, down from $112 million in the first quarter of last year, influenced by inorganic impacts and business mix.
Revenue Decline
Reported revenue declined by 4% to $401 million due to inorganic headwinds from FX, interest, and divestiture.
SMB Growth Challenges
SMB growth was tempered by a slower ramp in in-market direct sellers, with more work needed to optimize the SMB team and go-to-market channels.
Higher Attrition Rate
Attrition reduced revenue by approximately 12% in Q1, which was slightly higher than expected for the full year.
Company Guidance
In the first quarter of 2025, Paysafe reported a 5% organic revenue growth, driven by existing customer growth and new partnerships, despite a 4% decline in reported revenue to $401 million. Adjusted EBITDA was $95.2 million with a 23.7% margin. The company anticipates second-half acceleration with organic growth expected to reach 8-10%, bolstered by new products, expanded partnerships, and enhanced sales productivity. Merchant Solutions saw 6% organic growth, while digital wallets grew by 3% organically. Paysafe's strategic focus includes expanding its sales team and product capabilities, particularly in Latin America, where e-commerce is projected to grow at a 12% CAGR, reaching $29 billion by 2030.
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.