Citi Analyst Downgrades Paymentus Holdings Due to Stock’s Gains

Paymentus Holdings stock retreated 4% Thursday (Oct. 5) after being downgraded to Neutral by Citi analyst Ashwin Shirvaikar.

This downgrade was primarily driven by the stock’s substantial gains this year, which have reached 79% year-to-date, Seeking Alpha reported Thursday.

Despite the downgrade, Shirvaikar maintains a positive view on Paymentus’ fundamentals, citing consistent strong momentum in bookings and improved operational efficiency, according to the report.

This downgrade follows a similar move by Baird analyst David Koning, who downgraded Paymentus last month due to a spike in its valuation, the report said.

Paymentus stock leapt in August after the firm reported adding bookings and new clients across a variety of verticals for its cloud-based bill payment solutions during the previous quarter. The company also recorded 24.1% revenue growth year over year to $148.9 million, PYMNTS reported at the time.

During the company’s Aug. 7 earnings call, Paymentus Founder and CEO Dushyant Sharma said the bookings results supported the firm’s belief that its bill payment platform is universally scalable to any vertical and business.

Sharma added that, post-pandemic, Paymentus can meet with large clients face to face during the implementation process, thereby collaborating more closely and developing solutions as they onboard complex workflows.

“We’re excited about the long-term prospects of the business,” Sharma said. “We believe we are well positioned to leverage our ecosystem, our payment operating system and the various applications we support to grow our business.”

More recently, Paymentus announced the validation of its Paymentus Patient Billing and Payments stack through the Oracle Health developer program. This validation allows Paymentus to connect to the Oracle Health electronic health record and supply healthcare providers with advanced billing, payment and disbursement capabilities, the company said when announcing the news on Sept. 13.

As the payments landscape continues to evolve, there is an increasing need for payment providers to have access to a comprehensive direct biller network and modern technical infrastructure to facilitate transactions, Ron Bergamesca, general manager of banking and FinTech solutions at Paymentus, told PYMNTS in an interview posted in August.

“If you’re going to compete not only today, but in the future, and continuous innovation is an important part of that — then underlying technology that is modern, flexible and open is something you need,” Bergamesca said.