PSFE - Paysafe downgraded at RBC on disappointing Q2 murky year outlook

RBC Capital Markets analyst Daniel Perlin has cut Paysafe ( NYSE: PSFE ) stock to Sector Perform from Outperform as its Q2 results and full-year guidance were impacted by poor macroeconomic conditions and foreign exchange headwinds.

After Q2 earnings, the company's new CEO, Bruce Lowthers, introduced an action plan of refocusing on product innovation, increasing cross-selling and realigning the executive team to return to growth in 2023, but "we believe that these initiatives will take several quarters to implement," Perlin wrote in a note to clients Thursday.

"I am convinced that we will return to growth in 2023," Lowthers said during his company's Q2 earnings call on August 10.

In order for growth come to fruition, Perlin said he wants to see signs of the action plan working alongside a "significant reduction" in macro-related headwinds.

Overall, the analyst lowered his 2022 revenue estimate to $1.48B from $1.53B in the prior view. He also reduced his full-year adjusted EBITDA estimate to $405M from $440M previously.

RBC's Sector Perform rating, meanwhile, diverges from the Quant's Strong Sell, but agrees with the average Wall Street Analysts' Hold.

Take a look at why fellow Seeking Alpha contributor Busted IPO Forum justifies Paysafe as a Hold .

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