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Priority Technology Pre-Q2 Earnings: Buy, Sell or Hold the Stock?

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Key Takeaways

  • PRTH is expected to post Q2 revenues of $241.8M and EPS of $0.25, both indicating strong y/y growth.
  • Despite past beats, PRTH has an Earnings ESP of 0.00% and a Zacks Rank #3, signaling low beat probability.
  • PRTH trades at 5.45X P/E, cheaper than peers, but lags the industry, and faces rollout and regulatory risks.

Priority Technology Holdings, Inc. (PRTH - Free Report) will report second-quarter 2025 results on Aug. 7, before market open.

The Zacks Consensus Estimate for revenues in the to-be-reported quarter is pegged at $241.8 million, indicating a 10% year-over-year increase. The consensus estimate for total earnings is pinned at 25 cents per share, suggesting a more than 100% surge from the year-ago quarter’s actual. There has been no change in analyst estimates or revisions lately.

 

Zacks Investment ResearchImage Source: Zacks Investment Research

 

PRTH’s earnings surprise of 10% was impressive in the first quarter of 2025.

PRTH Showcases Lower Chances of Posting Q2 Earnings Beat

Our proven model does not conclusively predict an earnings beat for Priority Technology this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. But that is not the case here. You can uncover the best stocks to buy or sell before they are reported with our Earnings ESP Filter.

PRTH has an Earnings ESP of 0.00% and a Zacks Rank #3 at present. You can see the complete list of today’s Zacks #1 Rank stocks here.

PRTH’s Platform to Have Been Its Growth Driver in Q2

Priority Technology’s platform provides long-term growth prospects. It enables partners to easily adapt to offerings as the latest features are added. This approach allows the company and its partners to have clarity of potential top-line growth, bolstering loyalty and facilitating long-term partnerships. Furthermore, being consistent in operational workflow across implementation in diverse industry segments, PRTH can identify its operational metrics in vital areas, including payment operations, risk and compliance, to assist in scaling cost-effectively.

PRTH Stock Lags Industry & Peers

Priority Technology shares have soared 45.2% in a year, underperforming the 69.3% surge of its industry but surpassing the 19.7% rise of the Zacks S&P 500 composite. The company has underperformed its industry peers, Coherent Corp. (COHR - Free Report) and JBT Marel Corporation (JBTM - Free Report) . Coherent Corp and JBT Marel have gained 84.2% and 49.2%, respectively, for the same period.

1-Year Price Performance

 

Zacks Investment ResearchImage Source: Zacks Investment Research

 

The PRTH stock appears cheaper than the industry. Priority Technology is currently trading at a trailing 12-month price-to-earnings ratio of 5.45X, lower than the industry’s 22.89X. PRTH is cheaper than Coherent Corp’s 22.49X and JBT Marel’s 19.79X.

P/E - F12M

 

Zacks Investment ResearchImage Source: Zacks Investment Research

 

PRTH’s Investment Considerations

The global digital payment market is projected to grow, seeing a CAGR of 21.4% from 2025 to 2030, driven by tech advancements, shifting consumer preferences and supportive regulations. Priority Technology can benefit as the market expands and capture a fair share of the market pie.

The company has performed well over the past quarter. The top line has improved 9% year over year in the first quarter of 2025, with the gross margin and adjusted EBITDA increasing 14% and 11%, respectively. PRTH has ample liquidity with current debt of $2 million, and cash and cash equivalents of $59 million. A current ratio of 1.06 further solidifies the company’s liquidity position as it indicates effectiveness in paying short-term obligations.

Despite being exposed to fierce competition, Priority Technology Holdings’ focus on platforms and payables makes it a one-stop shop for customers. PRTH’s long-term growth prospects are deeply enhanced by the management prioritizing the continuous scaling of higher-margin Enterprise and B2B businesses and cross-selling new products.

That being said, multiple challenges weigh on the company’s performance. PRTH’s margins may be affected if there are major changes in card fees and banking regulations. Since the company’s growth is tied to tech advancements, delays in the One Priority system’s rollout may disrupt operations and increase costs.

Final Verdict

Operating within the digital payment domain provides PRTH with the opportunity to grow as the market expands. The company’s platform is instrumental in fostering loyal and long-term partnerships, boosting the top line. Being a one-stop shop for customers allows the company to have a competitive edge.

However, challenges prevail, affecting the company’s performance. Being subjected to any changes in banking regulations can impact margins. Delays in the rollout of One Priority can affect operations and increase costs. Moreover, a lower probability of earnings beat raises red flags for investors.

Weighing the pros and cons, we recommend that investors holding the stock refrain from buying more units. Investors who are planning to buy this stock should wait till the earnings release to gauge its performance.


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