Why Pagaya Stock Tumbled in March 43

According to Standard & Poor's Global Market Intelligence( S&P Global Market Intelligence )The data provided.Pagaya Technologies(Nasdaq ResonanceStock Code(PGY)Shares of the company plummeted 43% in March, setting the stage for the decline by announcing a new stock offering after the company conducted a 12-for-1 stock split of Bubbles at a lower price.

These amazing new updates

Pagaya operates an Artificial Intelligence (AI)-enabled credit platform that works with lenders to identify good borrowers without increasing risk. It has multiple products, including those for personal loans, credit cards, auto loans, and more. The company has been adding lending partners at a rapid pace, and by the end of 2023 had 29 name partner customers, includingVisarespond in singingAlly Bank The company has recently entered into a partnership with Bank of America (BofA), the fifth largest bank in the United States. Recently, the company has signed a contract with Bank of America (BofA), the fifth largest bank in the United States.U.S. BankThe company has 109 financing partners and is the number one issuer of asset-backed securities in the United States. The company has 109 funding partners and is the number one issuer of asset-backed securities in the United States.

Pagaya has maintained its strong growth momentum. in the fourth quarter of 2023, network volume grew 33% year-over-year to $2.3 billion, revenue grew 13%. net loss decreased by $20 million to $14 million, and Wall Street is estimating positive earnings per share for the first quarter of 2024.

Pagaya went public in 2022 through a Special Purpose Acquisition Company (SPAC) transaction. The company's stock price soared immediately, but then dipped and was trading around $1 until last month's share split by Bubbles.

In January, management announced that it would take two specific strategic actions to improve the "marketability" of the stock and long-term value for shareholders. These include the relocation of the company's corporate headquarters from Tel Aviv to New York and a stock split of Bubbles. Shares trading at $1 will not be considered for certain index or institutional investment accounts.

Immediately after that, the company issued new shares at a price of $12.70, which was lower than the share price at the time, setting the stage for a decline in the share price.

What does this mean for the future of Pagaya?

Securities is Pagaya's business, so it understands the implications of these actions better than any other company, but it has decided to continue to do so. Investors may not know the full story, which makes you wonder what else is going on. This also increases the risk.

Meanwhile, Pagaya stock looks very cheap right now. If the company becomes cash-flow positive and profitable on a GAAP basis, its stock could really take off this year. It's incredibly cheap, with a price-to-sales ratio of 0.8 and a forward price-to-earnings ratio of less than 6. It's the kind of undervalued growth stock that investors dream about.

If you have a higher risk appetite, you may want to take a small position in Pagaya now, but most investors should keep it on watch.

Should you invest $1,000 in Pagaya Technologies now?

Before buying shares of Pagaya Technologies, consider the following:

Motley Fool Stock AdvisorThe analyst team has just named what they believe to be the best value for investors.10Pagaya Technologies is not one of the 10 stocks listed on ....... The 10 stocks that made the list are poised to generate huge returns in the coming years.

Stock AdvisorIt provides investors with an easy-to-understand blueprint for success, including guidance on building a portfolio, regular updates from analysts, and two new stock picks each month. Since 2002, StockAdvisorThe service has more than doubled the return on the S&P 500 Index.

View 10 stocks only

*Stock Advisory Rates as of April 1, 2024

Ally is an advertising and caring partner of The Ascent, a Motley Fool company. jennifer Saibil does not hold any of the above shares. the Motley Fool holds recommendations for U.S. Bancorp and Visa. the Motley Fool recommends Pagaya Technologies. The Motley Fool recommends Pagaya Technologies. The Motley Fool has a disclosure policy.

Why did Pagaya stock plummet 43% in March?