XLF - P10, Inc. Q1 Earnings: Small Alternative Investments Manager Getting Started
2025-05-21 09:23:54 ET
Summary
- I rate P10, Inc. stock a Sell for long-term capital appreciation investors due to weak earnings and underperformance versus sector benchmarks.
- Q1 2025 results showed minimal revenue growth, declining profits, and a modest dividend increase that does little for income-focused investors.
- PX underperforms peers in total return and dividend yield, while trading at a premium valuation with no clear growth catalysts ahead.
- Given stiff competition and lack of momentum, I recommend selling PX and reallocating to better opportunities in the financial sector.
I rate P10, Inc. (NYSE: PX ) a Sell, for capital appreciation focused investors who are looking for long-term buy and hold investments. P10 is a microcap stock with a $1.34 billion market cap, which began paying dividends in 2022. As a young company it is still building a foundation and is not able to generate extraordinary growth. In the first quarter revenues grew, however, expenses grew faster, generating a decline in profits. The most crucial factors that influence my opinion of the stock are:
- Q1 Earnings showed a decline in earnings and margin.
- Total return over the past 3 years underperforms the Financial Services sector index.
- Small company competing against much larger companies with more resources.
- Pays a steadily growing quarterly dividend with a 1.25% yield annually.
- No current catalysts for major growth other than potential acquisition of other small financial companies.