Pagaya to Participate in Upcoming December Investor Conferences Share NEW YORK--(BUSINESS WIRE)--Pagaya Technologies Ltd. ("Pagaya†or the "Company†), a global technology company delivering AI-driven product solutions for the financial ecosystem, today announced that the Company's management team will participate in the following investor conferences: UBS Technology ConferenceDate: December 3-4, 2025Location: Scottsdale, AZ Jefferies Specialty Finance Crossover ConferenceDate: December 11, 2025Location: Ne ...

Core Insights - Pagaya Technologies Ltd. (PGY) and Upstart Holdings, Inc. (UPST) are key players in the AI-driven lending ecosystem, with distinct operational models [1] - Pagaya operates as a B2B enabler, while Upstart functions closer to a traditional lending marketplace [1] Pagaya Technologies Ltd. (PGY) - Pagaya has a capital-light operating model, reducing exposure to credit risk and enhancing scalability [3] - The company has diversified its loan offerings beyond personal loans to include auto lending and point-of-sale financing, improving resilience across economic cycles [5] - Pagaya has established a network of over 135 institutional partners and utilizes forward flow agreements to ensure funding stability [5][7] - The company has raised over $4 billion to fund personal loans in 2025, including a recent forward flow agreement for up to $500 million in auto loans [8] - Pagaya has achieved three consecutive quarters of positive GAAP net income, marking a turnaround from previous losses [9] - The stock has gained 49.9% over the last six months, outperforming Upstart, which has lost 13.7% [16] - Pagaya's return on equity (ROE) stands at 44.45%, significantly higher than Upstart's 23.54% [19] - The Zacks Consensus Estimate indicates year-over-year revenue growth of 28.4% and 19.2% for 2025 and 2026, respectively, with earnings growth of 273.5% and 10% [20] Upstart Holdings, Inc. (UPST) - Upstart utilizes machine learning to evaluate non-traditional data points for loan approvals, allowing for a broader range of borrowers [2] - The company has expanded into auto lending and is exploring small business loans and mortgages to diversify revenue streams [12] - Upstart's AI models detected rising risk, leading to tightened loan approvals and a decrease in conversion rates from 23.9% to 20.6% [14] - The company reported its best quarter for new bank and credit union partners, adding seven partners and reaching an all-time high in available monthly funding [15] - The Zacks Consensus Estimate for Upstart indicates revenue growth of 62.8% and 15.9% for 2025 and 2026, respectively, with earnings growth of 940% and 57.7% [24] Comparative Analysis - Pagaya's valuation is more favorable, trading at a trailing 12-month price-to-book (P/B) of 3.51X compared to Upstart's 5.10X [17] - Pagaya's flexible, capital-light model and strong funding network position it for long-term growth, while Upstart's model is more susceptible to credit cycles and capital market fluctuations [26][27]

Key Takeaways PGY posted 10.5% y/y network volume growth in the first nine months of 2025.PGY's move into auto lending and point-of-sale financing has driven its network volume gains.PGY's diversified funding and better credit trends boosted fees and overall revenue growth.Pagaya Technologies Ltd. (PGY) has recorded robust growth in network volume (which is the main driver of its top line) so far in 2025. In the nine months ended Sept. 30, 2025, year-over-year network volume growth was 10.5%.With a resilien ...

Bert Hochfeld graduated with a degree in economics from the University of Pennsylvania and received an MBA from Harvard. Mr. Hochfeld has enjoyed a long career in the tech world, working for IBM, Memorex/Telex, Raytheon Data Systems, and BMC Software. Starting in the 1990s, Mr. Hochfeld worked as a sell-side analyst and won awards from the Wall Street Journal for his coverage of the software space. In 2001, Mr. Hochfeld formed his own independent research company, Hochfeld Independent Research Group, which ...

Core Insights - Pagaya Technologies (PGY) shares have increased by 56.8% over the past six months, significantly outperforming the S&P 500 Index's growth of 14.8% and the broader industry, which declined by 6.7% [1][2][8] Performance Drivers - The strong performance of PGY is attributed to robust network volume growth, improved monetization, better operating leverage, and solid credit discipline, alongside an enhanced capital structure [2][8] - PGY has achieved profitability this year by avoiding overexposure to credit risk, outperforming competitors like LendingTree (TREE) and Upstart Holdings (UPST), which saw gains of 39.2% and a loss of 15.1%, respectively [2][8] Business Model and Strategy - PGY's diversified and resilient business model allows it to expand beyond personal loans into auto lending and point-of-sale financing, reducing exposure to cyclical risks [6][8] - The company has established a network of over 135 institutional funding partners, utilizing forward flow agreements to secure funding for asset-backed securities (ABS), providing a critical alternative funding source during market stress [7][11] Financial Structure - Pagaya operates a capital-efficient model that minimizes credit risk by avoiding holding loans on its balance sheet, relying on institutional funding partners and issuing ABS [11][12] - The off-balance-sheet model has proven effective during periods of elevated interest rates and market stress, maintaining financial flexibility [13][14] Expense Trends - Pagaya has experienced a compound annual growth rate of 26.2% in total costs and operating expenses over the past three years, primarily due to rising production costs [15][16] - The increase in production costs is expected to continue, impacting PGY's bottom-line growth in the near term [16] Investment Outlook - Despite rising expenses potentially affecting bottom-line growth, PGY's resilient business model and capital-efficient funding strategy position it favorably in the fintech space [18] - Analysts maintain a neutral stance on PGY, with earnings estimates for 2025 and 2026 remaining unchanged at $2.65 and $3.40, respectively [19][20]

Core Viewpoint - Pagaya Technologies Ltd. (PGY) has received a Zacks Rank 2 (Buy) upgrade, indicating a positive outlook on its earnings estimates, which is a significant factor influencing stock prices [1][3]. Earnings Estimates and Stock Price Movement - The Zacks rating system is based on the consensus measure of EPS estimates from sell-side analysts, reflecting the company's changing earnings picture [1][2]. - Changes in earnings estimates are strongly correlated with near-term stock price movements, particularly due to the actions of institutional investors who adjust their valuations based on these estimates [4][5]. Recent Performance and Projections - Pagaya Technologies Ltd. is expected to earn $3.10 per share for the fiscal year ending December 2025, with no year-over-year change; however, the Zacks Consensus Estimate has increased by 27.4% over the past three months [8]. - The upgrade to Zacks Rank 2 places Pagaya in the top 20% of Zacks-covered stocks, suggesting potential for market-beating returns in the near term [10]. Zacks Rank System - The Zacks Rank system classifies stocks into five groups based on earnings estimates, with a proven track record of Zacks Rank 1 stocks generating an average annual return of +25% since 1988 [7]. - The system maintains a balanced distribution of "buy" and "sell" ratings, ensuring that only the top 5% of stocks receive a "Strong Buy" rating, which highlights the significance of Pagaya's recent upgrade [9].

Core Insights - Pagaya has been a standout performer in the fintech sector, particularly in 2025, and is considered a top pick in the lending and lendtech coverage by Citigroup [1][2] - Prior to recent market turmoil, Pagaya was the best performing company among all fintechs in Citigroup's screening [2] Company Performance - The company has experienced significant stock price appreciation and positive developments in its operations throughout the year [2] - Pagaya's performance has been characterized by both strong market movement and underlying operational success [2]

Summary of Pagaya Technologies FY Conference Call Company Overview - **Company**: Pagaya Technologies (NasdaqCM: PGY) - **Industry**: Specialty finance and fintech - **Business Model**: B2B white label solutions for lending institutions, integrating AI/ML-based credit decisioning tools with various lending partners [9][10][12] Key Financial Highlights - **Third Quarter Performance**: - Achieved GAAP net income for the third consecutive quarter, with a run rate of approximately $110 million [15] - Application flow increased by 12% quarter-over-quarter, with volume growth of 6% [16] - Fee revenue grew by 10%, adjusted EBITDA increased by 24%, and net income rose by 35% [17] - **Guidance for 2025**: Increased guidance reflecting strong performance and onboarding of new lending partners [14] Credit Performance and Consumer Insights - **Macro Environment**: No observed deterioration in credit performance despite concerns about consumer health; stable underwriting practices maintained [18][20] - **Consumer Metrics**: Underwriting criteria remain stringent, with a focus on personal loans for consumers with a minimum FICO score of 670 and an income of $115,000 [20] - **Delinquency Rates**: Elevated delinquencies noted in auto loans, but recovery rates improved compared to previous years [22] Growth Strategy - **Partner Onboarding**: Eight new lending partners are in the onboarding phase, expected to contribute to growth in 2026 and 2027 [16][30] - **Growth Projections**: Anticipated consistent annual growth of around 20%, driven by existing and new partners, as well as product-led strategies [25][30] - **Product Expansion**: Focus on cross-selling and introducing new products to existing partners, with 60% of partners currently engaged in one product [28] Funding and Market Dynamics - **Funding Mix**: Currently at a 60-40 split between ABS and forward flow agreements, aiming for a balanced 50-50 mix [45][52] - **Market Demand**: Strong demand from institutional investors for consumer credit, despite fluctuations in equity markets [42][44] Competitive Landscape - **Unique Positioning**: Pagaya's B2B model and white label solutions are difficult to replicate, requiring significant investment and time to build infrastructure and data [54][56] - **Value Proposition**: Offers banks and fintechs solutions to capture declined applications, enhancing their customer retention and cross-selling opportunities [58][61] Technology and AI Integration - **AI Utilization**: AI enhances decision-making processes but does not predict future losses; the focus is on leveraging extensive data from multiple partners to improve underwriting accuracy [73][75] Conclusion - Pagaya Technologies is positioned for steady growth with a strong financial performance, a unique business model, and a focus on leveraging technology and partnerships to enhance its offerings in the specialty finance and fintech sectors [31][39]

Core Viewpoint - KBRA has assigned preliminary ratings to seven classes of notes issued by Research-Driven Pagaya Motor Asset Trust 2025-6 and Research-Driven Pagaya Motor Trust 2025-6, indicating a structured approach to evaluating the creditworthiness of this auto loan ABS transaction [1] Summary by Categories Credit Enhancement - RPM 2025-6 features initial credit enhancement levels ranging from 89.26% for Class A-1 notes to 1.86% for Class E notes, highlighting a significant level of protection for investors [1] Structure of Notes - The credit enhancement is composed of overcollateralization, subordination of junior note classes (excluding Class E notes), and a cash reserve, which collectively aim to mitigate risks associated with the underlying auto loans [1]

Summary of Pagaya Technologies FY Conference Call Company Overview - **Company**: Pagaya Technologies (NasdaqCM: PGY) - **Industry**: Fintech, specifically in lending technology Key Points and Arguments Sustainable Growth Strategy - Pagaya emphasizes a **B2B strategy** that focuses on sustainable growth rather than aggressive marketing tactics common in B2C lending [3][4][10] - The company aims to create **sticky growth** by enhancing product value for existing partners and customers, rather than relying on market fluctuations [3][10] Product Development and Innovation - Pagaya has developed a **Decline Monetization product** and a **Marketing Affiliate product** to assist lenders in acquiring more customers [6][7] - The introduction of the **FastPass** feature allows dealerships to provide immediate loan approvals without manual verification, enhancing customer experience [9][10] - The company has an **18-month product roadmap** to drive value for existing partners and improve onboarding processes [11] Market Performance and Economic Conditions - Pagaya's growth has been stable, with a reported growth rate of **20%-25%**, avoiding volatility by not aggressively expanding the credit box [21][22] - The company has observed a **150 basis point reduction in the cost of capital** from 2024 to 2025, contributing to improved performance metrics [16][17] - Delinquency rates remain healthy, indicating strong performance compared to post-COVID levels [15][16] Capital Market Strategy - Pagaya is focused on optimizing its **cash flow profile** and has achieved cash flow positivity, which is crucial for future growth [33][34] - The company is originating **$10 billion** across personal loans, auto loans, and point-of-sale (POS) lending, with a significant portion through forward flow agreements [34][35] - Pagaya plans to increase its **forward flow agreements** but aims to maintain a balance to avoid over-leverage [93] Future Outlook - The company envisions becoming a **leading technology provider** in the lending space, addressing core problems for lenders across various asset classes [109][110] - Pagaya is working towards enhancing its partnerships and expanding its product offerings to drive future growth [113][114] Additional Insights - The company is monitoring consumer spending and job growth as key indicators for potential market changes [28][29] - Pagaya's strategy includes leveraging technology to improve the lifetime value of customers and enhance engagement with partners [74][75] Important but Overlooked Content - The company is cautious about the competitive landscape in personal lending and is closely monitoring delinquencies and market conditions [29][30] - Pagaya's approach to risk management includes maintaining a healthy margin and being prepared to adjust strategies based on economic conditions [21][22] This summary encapsulates the key insights from Pagaya Technologies' FY conference call, highlighting the company's strategic focus, market performance, and future outlook in the fintech lending industry.