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PGY Shares Surge 93.8% in 6 Months: Should You Buy It Now?
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Key Takeaways
Pagaya shares jumped 93.8% in six months, outperforming the broader market and industry peers.
PGY's Q2 network volume rose 33% y/y, revenues climbed 19% and adjusted EBITDA grew 43%.
Pagaya raised its 2026 outlook as funding, operating leverage and multi-product expansion strengthened.
Pagaya Technologies (PGY - Free Report) shares have skyrocketed 93.8% in the past six months, outperforming the S&P 500 Index and the industry it belongs to.
If we compare the company’s price performance to its close peers, LendingTree (TREE - Free Report) and Upstart Holdings (UPST - Free Report) , it appears that the PGY stock has fared much better than both these firms. Shares of LendingTree have lost 23.3%, whereas Upstart has gained 2.8% in the past six months.
6-Month Price Performance
Image Source: Zacks Investment Research
In the first two months of this year, PGY shares came under significant pressure largely due to concerns over slowing near-term growth. Investors reacted negatively to the company’s fourth-quarter 2025 results. Although the company recorded its fourth straight quarter of positive GAAP net income in the three months ended Dec. 31, 2025 (as against negative earnings in the prior years), management issued softer-than-expected guidance for early 2026. Along with this, management’s decision to tighten underwriting standards and reduce exposure to higher-risk credit segments weakened investor sentiments, sending the PGY stock lower.
However, from March, the company’s shares staged a strong rebound, as subsequent results demonstrated that the slowdown was temporary and that profitability remained robust. PGY’s first-quarter adjusted EBITDA increased 18% year over year, prompting the company to raise its full-year net income guidance.
The momentum accelerated in the second quarter, with network volume growing 33%, revenues rising 19% and adjusted EBITDA jumping 43%. Management once again raised its 2026 earnings outlook. Investor confidence was also supported by strong capital-market execution, including several upsized, AAA-rated asset-backed securities (ABS) transactions, record funding activity, new lending partners and expansion of existing partnerships.
Stronger-than-expected operating growth, rising profitability, improved credit discipline and continued access to institutional funding together helped drive the sharp recovery in PGY shares between March and August.
Given the recent strength in price, investors might be tempted to invest in the stock now. However, before making any investment decision, it is important to examine the company’s fundamentals and growth prospects to see if it has upside potential left.
Key Fundamental Strengths of PGY
Diversified Funding Base: A diversified funding base is a key positive for Pagaya. The company continues to broaden its funding base, supporting an upfront model that raises cash before loans are originated. In second-quarter 2026, Pagaya raised $3.7 billion in funding across six ABS transactions, its largest quarterly funding volume to date. It also added 11 new investors, bringing the total to 174.
Funding channels are becoming more flexible, with 40% of funding now coming through non-prefunded ABS products alongside forward flow and revolving structures.
The company has expanded its accrued loan purchasing fee receivables facility to $100 million from $65 million. This broader funding base improves execution visibility as network volume scales across personal loans, auto and point of sale (POS).
Multi-Product Expansion: Multi-product expansion is expected to deepen Pagaya’s partner economics. New products are widening partner use cases and raising revenues per application. In first-half 2026, revenues from fees increased as partner adoption broadened. The company's product-led playbook is being applied across personal loans, auto and POS, supported by pre-built integrations that can shorten partner onboarding.
In personal loans, the Affiliate Optimizer engine contributed more than $1 billion of network volume in the second quarter. Experian Activate has been adopted by key partners, with additional partners targeted in the second half of 2026, including regional banks.
In auto, Pagaya is using dynamic offer optimization to structure down payment, annual percentage rate (APR), loan-to-value and term in real time at the dealer point of sale. Seven new partners were onboarded over the last six months across personal loans, auto and POS, supporting broader penetration beyond the company's flagship product.
Improving Operating Leverage: Improving operating leverage and cost efficiency has been driving Pagaya’s earnings growth of late. Across 2025, monetization and efficiency strengthened. The company’s revenue growth outpaced expense growth, allowing margins to improve and turning prior losses into positive net income.
In 2025, adjusted EBITDA rose sharply, showing that the platform scaled efficiently as utilization increased. The company’s profitability streak continued in 2026, with spending in check. In the first half of this year, total revenues increased to $705 million from $616.4 million in the year-ago period, while operating expenses rose only slightly to $519.2 million from $512.2 million. Core operating expenses declined 6% year over year and were 31% of fee revenue less production costs, a record low.
Management noted that core OpEx has been broadly flat for about 18 months, even as revenues and profits scaled. Management expects 2026 GAAP net income of $155-$180 million and adjusted EBITDA of $460-$490 million, reflecting confidence in further scale without a major expense ramp.
Analyzing Pagaya’s Valuation
In terms of valuation, the PGY stock looks inexpensive compared with the industry at large. The stock is trading at a forward 12-month price/sales (P/S) ratio of 1.13X, below the industry average of 2.59X over the last three years.
Price-to-Sales F12M
Image Source: Zacks Investment Research
While Pagaya is trading at a discount compared with Upstart, the stock appears to be trading at a premium compared with TREE. LendingTree has a P/S (F12M) ratio of 0.30X, while Upstart has a P/S ratio of 1.65X.
How to Approach the Pagaya Stock Now?
Given its robust performance in the last six months, a resilient business model and capital-efficient funding strategy, PGY continues to stand out in the fintech space. Its AI-driven platform, diversified revenue streams and reliance on forward flow agreements shield it from market volatility and credit risks.
Analysts seem optimistic regarding PGY’s earnings growth potential. Over the past 30 days, the Zacks Consensus Estimate for Pagaya’s 2026 and 2027 earnings has been revised upward to $3.72 and $4.13 per share, respectively. The estimated numbers indicate year-over-year growth rates of 12.4% and 11% for 2026 and 2027, respectively.
Earnings Estimate Revision
Image Source: Zacks Investment Research
Thus, with accelerating earnings estimates, along with bullish analyst sentiments, PGY is well-positioned for continued growth. Moreover, the stock trades at a discount relative to the industry at large, making its valuation attractive. For investors seeking exposure to a high-growth, tech-enabled lender with solid fundamentals, the PGY stock is a compelling buy.
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PGY Shares Surge 93.8% in 6 Months: Should You Buy It Now?
Key Takeaways
Pagaya Technologies (PGY - Free Report) shares have skyrocketed 93.8% in the past six months, outperforming the S&P 500 Index and the industry it belongs to.
If we compare the company’s price performance to its close peers, LendingTree (TREE - Free Report) and Upstart Holdings (UPST - Free Report) , it appears that the PGY stock has fared much better than both these firms. Shares of LendingTree have lost 23.3%, whereas Upstart has gained 2.8% in the past six months.
6-Month Price Performance
Image Source: Zacks Investment Research
In the first two months of this year, PGY shares came under significant pressure largely due to concerns over slowing near-term growth. Investors reacted negatively to the company’s fourth-quarter 2025 results. Although the company recorded its fourth straight quarter of positive GAAP net income in the three months ended Dec. 31, 2025 (as against negative earnings in the prior years), management issued softer-than-expected guidance for early 2026. Along with this, management’s decision to tighten underwriting standards and reduce exposure to higher-risk credit segments weakened investor sentiments, sending the PGY stock lower.
However, from March, the company’s shares staged a strong rebound, as subsequent results demonstrated that the slowdown was temporary and that profitability remained robust. PGY’s first-quarter adjusted EBITDA increased 18% year over year, prompting the company to raise its full-year net income guidance.
The momentum accelerated in the second quarter, with network volume growing 33%, revenues rising 19% and adjusted EBITDA jumping 43%. Management once again raised its 2026 earnings outlook. Investor confidence was also supported by strong capital-market execution, including several upsized, AAA-rated asset-backed securities (ABS) transactions, record funding activity, new lending partners and expansion of existing partnerships.
Stronger-than-expected operating growth, rising profitability, improved credit discipline and continued access to institutional funding together helped drive the sharp recovery in PGY shares between March and August.
Given the recent strength in price, investors might be tempted to invest in the stock now. However, before making any investment decision, it is important to examine the company’s fundamentals and growth prospects to see if it has upside potential left.
Key Fundamental Strengths of PGY
Diversified Funding Base: A diversified funding base is a key positive for Pagaya. The company continues to broaden its funding base, supporting an upfront model that raises cash before loans are originated. In second-quarter 2026, Pagaya raised $3.7 billion in funding across six ABS transactions, its largest quarterly funding volume to date. It also added 11 new investors, bringing the total to 174.
Funding channels are becoming more flexible, with 40% of funding now coming through non-prefunded ABS products alongside forward flow and revolving structures.
The company has expanded its accrued loan purchasing fee receivables facility to $100 million from $65 million. This broader funding base improves execution visibility as network volume scales across personal loans, auto and point of sale (POS).
Multi-Product Expansion: Multi-product expansion is expected to deepen Pagaya’s partner economics. New products are widening partner use cases and raising revenues per application. In first-half 2026, revenues from fees increased as partner adoption broadened. The company's product-led playbook is being applied across personal loans, auto and POS, supported by pre-built integrations that can shorten partner onboarding.
In personal loans, the Affiliate Optimizer engine contributed more than $1 billion of network volume in the second quarter. Experian Activate has been adopted by key partners, with additional partners targeted in the second half of 2026, including regional banks.
In auto, Pagaya is using dynamic offer optimization to structure down payment, annual percentage rate (APR), loan-to-value and term in real time at the dealer point of sale. Seven new partners were onboarded over the last six months across personal loans, auto and POS, supporting broader penetration beyond the company's flagship product.
Improving Operating Leverage: Improving operating leverage and cost efficiency has been driving Pagaya’s earnings growth of late. Across 2025, monetization and efficiency strengthened. The company’s revenue growth outpaced expense growth, allowing margins to improve and turning prior losses into positive net income.
In 2025, adjusted EBITDA rose sharply, showing that the platform scaled efficiently as utilization increased. The company’s profitability streak continued in 2026, with spending in check. In the first half of this year, total revenues increased to $705 million from $616.4 million in the year-ago period, while operating expenses rose only slightly to $519.2 million from $512.2 million. Core operating expenses declined 6% year over year and were 31% of fee revenue less production costs, a record low.
Management noted that core OpEx has been broadly flat for about 18 months, even as revenues and profits scaled. Management expects 2026 GAAP net income of $155-$180 million and adjusted EBITDA of $460-$490 million, reflecting confidence in further scale without a major expense ramp.
Analyzing Pagaya’s Valuation
In terms of valuation, the PGY stock looks inexpensive compared with the industry at large. The stock is trading at a forward 12-month price/sales (P/S) ratio of 1.13X, below the industry average of 2.59X over the last three years.
Price-to-Sales F12M
Image Source: Zacks Investment Research
While Pagaya is trading at a discount compared with Upstart, the stock appears to be trading at a premium compared with TREE. LendingTree has a P/S (F12M) ratio of 0.30X, while Upstart has a P/S ratio of 1.65X.
How to Approach the Pagaya Stock Now?
Given its robust performance in the last six months, a resilient business model and capital-efficient funding strategy, PGY continues to stand out in the fintech space. Its AI-driven platform, diversified revenue streams and reliance on forward flow agreements shield it from market volatility and credit risks.
Analysts seem optimistic regarding PGY’s earnings growth potential. Over the past 30 days, the Zacks Consensus Estimate for Pagaya’s 2026 and 2027 earnings has been revised upward to $3.72 and $4.13 per share, respectively. The estimated numbers indicate year-over-year growth rates of 12.4% and 11% for 2026 and 2027, respectively.
Earnings Estimate Revision
Image Source: Zacks Investment Research
Thus, with accelerating earnings estimates, along with bullish analyst sentiments, PGY is well-positioned for continued growth. Moreover, the stock trades at a discount relative to the industry at large, making its valuation attractive. For investors seeking exposure to a high-growth, tech-enabled lender with solid fundamentals, the PGY stock is a compelling buy.
At present, Pagaya sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.