PGY Closes $400M RPM Deal: A Move to Further Diversify Funding?

Core Insights - Pagaya Technologies Ltd. (PGY) successfully closed a $400 million asset-backed securities (ABS) transaction backed by auto loans, marking its fifth auto ABS transaction in 2025 and bringing the year-to-date issuance to $1.7 billion, a record for the company [1][2][10] Group 1: Business Model and Strategy - The Revolving Pool Master (RPM) program serves as PGY's dedicated securitization platform, allowing the company to package and sell pools of auto loans to institutional investors, which is a key part of its capital markets strategy [3] - Pagaya operates a capital-efficient model by leveraging a robust network of institutional funding partners and focusing on issuing ABS, which helps minimize credit exposure and avoid significant loan write-downs [4] Group 2: Market Performance - PGY's stock has seen a significant increase of 198.4% over the past six months, outperforming the industry growth of 26.1% [9] - The current trading price-to-sales (P/S) ratio for Pagaya is 1.57X, which is below the industry average of 3.97X [11] Group 3: Earnings Estimates - The Zacks Consensus Estimate for PGY's earnings has increased to $2.65 for 2025 and $3.40 for 2026, indicating year-over-year growth of 219.3% and 28.3%, respectively [12]