Repay Holdings (RPAY) Stock Gets Price Target Cut to $4.50 by UBS

UBS has adjusted its price target for Repay Holdings (RPAY) from $7.50 to $4.50, maintaining a Neutral rating. The average 1-year price target is $8.36 with an upside of 107.02% from the current price of $4.04. Despite a 4% YoY decrease in revenue, the company maintains strong adjusted EBITDA margins of 43% and reported a 12% YoY increase in gross profit for the Business Payments segment.

UBS has revised its price target for Repay Holdings (RPAY) from $7.50 to $4.50, retaining a Neutral rating. The average 1-year price target is $8.36, with an upside of 107.02% from the current price of $4.04. Despite a 4% year-over-year (YoY) decrease in revenue, the company maintains robust adjusted EBITDA margins of 43% and reported a 12% YoY increase in gross profit for the Business Payments segment [3].

Repay Holdings reported its first-quarter 2025 results, with revenue at $77.3 million, a 4.2% decrease from the same period last year. The net loss widened to $7.95 million, a 53% increase from the first quarter of 2024. The earnings per share (EPS) loss per share deteriorated to $0.089, compared to $0.057 in the first quarter of 2024 [1]. The company's shares have increased by 6.5% from a week ago [1].

Analysts had mixed expectations for Repay Holdings' Q1 results. Revenue exceeded analyst estimates by 2.1%, while EPS missed estimates by 182%. Looking ahead, revenue is forecast to grow at an average annual rate of 5.8% over the next three years, compared to a 5.1% growth forecast for the Diversified Financial industry in the US [1]. The company's shares have lost about 48.4% since the beginning of the year compared to the S&P 500's decline of -3.8% [2].

UBS's adjustment comes amidst a challenging quarter for Repay Holdings. The company's strategic review process was concluded, and the share repurchase authorization was increased by $25 million to $75 million. The company's CEO, John Morris, expressed confidence in the company's ability to deliver growth and value for shareholders in the near term [3].

Repay Holdings faces several risks, including a significant decline in stock price and a widening net loss. Additionally, the company's strategic review process and the departure of its Chief Financial Officer, Tim Murphy, may impact its future performance. Investors should closely monitor the company's earnings call for further insights into its future prospects.

References:
[1] https://finance.yahoo.com/news/repay-holdings-first-quarter-2025-103223175.html
[2] https://www.nasdaq.com/articles/repay-holdings-rpay-q1-earnings-and-revenues-miss-estimates-0
[3] https://www.businesswire.com/news/home/20250512344859/en/REPAY-Reports-First-Quarter-2025-Financial-Results