The publication on Wednesday of a 119-page research report by New York-based short-selling firm Spruce Point Capital caused Nuvei stock price to collapse. The electronic payment-processing company went public 15 months ago. Spruce Point raised concerns about Nuvei and its senior management.
Full Answer
Why is nuvei stock down 53% in the last 3 months?
As interest rates are expected to rise, many growth stocks have taken a beating, as capital leaves the riskier stock market to lower-risk assets like cash. Specifically, Nuvei stock has declined approximately 53% in the last three months. To be fair, the growth stock was trading at a much higher valuation before.
How successful was nuvei’s US IPO?
Its U.S. IPO was particularly successful, raising gross proceeds of US$369.4 million at a stock price of US$123.14, which is a double from current levels. What happened? Nuvei stock dropped as much as 10.8% yesterday but finished the day marginally lower by 0.2%, which was essentially flat.
Is nuvei’s free cash flow good?
Michael Hakes, the senior portfolio manager at the Murray Wealth Group, mentioned last month on BNN that Nuvei generates good free cash flow. Indeed, the tech stock’s trailing 12-month free cash flow generation was US$223 million, which was helped by low capital spending.
What does nuvei have to do with Spruce Point?
Nuvei will provide the award-winning exclusive travel operator with a holistic global payment solution, including payments orchestration and smart routing. Well now, let's hope that at the upcoming investor meetings Nuvei shares with us what "aggressive" response they took regarding the Spruce Point report.
Why is Nuvei stock price dropping?
There has been no respite for Nuvei investors, as the stock has dropped 65% since September 2021. Tech investors are feeling the brunt of massive value erosion in the last six months. Faster interest rate hikes and stretched valuations have cut TSX tech stocks in half this year.
Is Nuvei a good investment?
It is one of the few technology companies that have become profitable at an early stage. It has increased its adjusted EBITDA by 95% in 2021 and plans to increase it by another 31% in 2022. Nuvei has a price-to-sales ratio of 13 times and a forward price-to-earnings ratio of 32 times.
What happen to Nuvei?
Nuvei stock fell 65% in this sell-off from October 2021 to February 2022. It was not just the tech sell-off but a negative report from Spruce Point Capital that was responsible for 38% of the dip. The report dug into the management's negative history of being involved with controversial people and Ponzi schemes.
Is Nuvei overvalued?
As of last year, the book value per share for Nuvei is $11.25, with a price-to-book ratio of 7, price-to-earnings ratio of 96.17, price-to-sales ratio of 17.47, and price-to-free cash flow ratio of -48.80. These all point to signs of Nuvei being overvalued, even at its lower current price.
Should I buy Lightspeed shares?
Foolish takeaway The business remains very solid, with the company continuing to attract new big-name customers. I believe Lightspeed could still be very successful in the coming years. As its business and earnings continue to grow, its stock price should follow, in theory.
Should I sell NVEI stock?
Out of 9 analysts, 3 (33.33%) are recommending NVEI as a Strong Buy, 4 (44.44%) are recommending NVEI as a Buy, 2 (22.22%) are recommending NVEI as a Hold, 0 (0%) are recommending NVEI as a Sell, and 0 (0%) are recommending NVEI as a Strong Sell. What is NVEI's earnings growth forecast for 2022-2024?
Is Nuvei profitable?
Past Earnings Growth Analysis Earnings Trend: NVEI has become profitable over the past 5 years, growing earnings by 41.7% per year. Accelerating Growth: NVEI has become profitable in the last year, making the earnings growth rate difficult to compare to its 5-year average.
Will Lspd go up?
The 19 analysts offering 12-month price forecasts for Lightspeed Commerce Inc have a median target of 40.00, with a high estimate of 65.00 and a low estimate of 24.19. The median estimate represents a +64.07% increase from the last price of 24.38.
Is NVEI overvalued?
NVEI is overvalued, but it has great fundamentals, and it makes money.
NASDAQ: NVEI
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What happened
Shares of Nuvei Corporation ( NVEI -3.24% ), a payment-processing company, were crumbling today after Spruce Point Capital Management, a short-seller, released a negative report about Nuvei. The tech stock had plummeted 39% as of 3:20 p.m. ET.
So what
Spruce Point wrote a long list of alleged problems with Nuvei, including:
Now what
It's not unusual for short-sellers to release negative reports about companies. Investors will have to decipher whether or not the allegations are reason enough to sell their shares.
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What happened?
Nuvei stock dropped as much as 10.8% yesterday but finished the day marginally lower by 0.2%, which was essentially flat. As interest rates are expected to rise, many growth stocks have taken a beating, as capital leaves the riskier stock market to lower-risk assets like cash.
So what?
Michael Hakes, the senior portfolio manager at the Murray Wealth Group, mentioned last month on BNN that Nuvei generates good free cash flow. Indeed, the tech stock’s trailing 12-month free cash flow generation was US$223 million, which was helped by low capital spending.
Now what?
13 analysts have a 12-month average price target that implies the potential for investors to double their money from the recent quotation of $74.85. However, don’t expect Nuvei stock to roar back immediately.
What happened?
Nuvei stock dropped as much as 10.8% yesterday but finished the day marginally lower by 0.2%, which was essentially flat. As interest rates are expected to rise, many growth stocks have taken a beating, as capital leaves the riskier stock market to lower-risk assets like cash.
So what?
Michael Hakes, the senior portfolio manager at the Murray Wealth Group, mentioned last month on BNN that Nuvei generates good free cash flow. Indeed, the tech stock’s trailing 12-month free cash flow generation was US$223 million, which was helped by low capital spending.
Now what?
13 analysts have a 12-month average price target that implies the potential for investors to double their money from the recent quotation of $74.85. However, don’t expect Nuvei stock to roar back immediately.
Spruce Point attacked Nuvei
The publication on Wednesday of a 119-page research report by New York-based short-selling firm Spruce Point Capital caused Nuvei stock price to collapse. The electronic payment-processing company went public 15 months ago.
Nuvei dismissed short-seller accusations
Meanwhile, in a statement released Wednesday evening, Nuvei dismissed Spruce Point Capital’s 119-page report.
Nuvei stock is oversold
Despite criticism from the short-seller, analysts remain largely bullish on Nuvei. They seem unanimous enough that the Spruce Point Capital report has huge analytical flaws and is riddled with unsubstantiated allegations.
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