By Sam Boughedda
Jefferies analysts initiated coverage of Payoneer Global (NASDAQ:PAYO) with a Buy rating and $7 per share price target in a research note on Monday.
They told investors their firm is favorable on PAYO's large and growing end-markets and its "entrenched position as the leading multi-currency digital wallet enablingSMBs/freelancers/remote workers to conduct cross-border commerce."
The ongoing mix shift to B2B should drive a higher multiple over time, while its first-mover advantage, geographic reach, and range of products and services distinguish it amid a fragmented competitive landscape, the analysts add.
Payoneer shares are down over 16% in the last six months, but analysts believe the story has been challenged due to "the inherent complexity of the business without a clean existing comp" and its "China/Amazon eComm/marketplace dependence."
"We see the emergence of PAYO's B2B AP/AR solutions (we expect to reach 21% of revenue by FY24, up from ~6% in FY19) as a key driver for multiple expansion with a large/untapped market, and introduces the potential for PAYO to be partially viewed as [an] international version of BILL," they conclude.