Pagaya Stock Rises Premarket After Worst Day In 15 Months: Wall Street Still Sees Up To 120% Upside And Calls Selloff ‘Violent’

CEO Gal Krubiner said company data shows no signs of consumer deterioration, and that credit performance across asset classes remains in line with expectations.

• Stephens, Keefe, Bruyette & Woods, and Benchmark cut price targets but pointed to 68%-121% upside from Pagaya's last close.
• Benchmark called the selloff “violent and largely disconnected,” saying the move reflected prudence and tail-risk reduction, not credit stress.
• Pagaya tightened underwriting late in Q4 amid consumer uncertainty.

Shares of Pagaya Technologies (PGY) rose 1.6% in premarket trading on Tuesday as Wall Street cut price targets but largely stood by bullish ratings, with analysts pointing to as much as 120% upside despite the stock’s worst session in over a year.

PGY stock plunged 24% to $14.19, its lowest level in more than eight months, and posted its worst session in nearly 15 months.

Wall Street View On PGY

Stephens lowered its price target on Pagaya Technologies to $25 from $33, implying a 68% upside from the stock’s last close, and kept an ‘Overweight’ rating. The brokerage noted that while Pagaya tightened underwriting, credit continues to perform “consistently,” and that there were no incremental write-downs in the fourth quarter (Q4.)

Keefe, Bruyette & Woods similarly lowered its price target to $30 from $35, pointing to a 101% upside from the stock’s current levels, and kept an ‘Outperform’ rating. The firm said a volume miss and lowered outlook prompted it to reduce 2026 and 2027 estimates, but added that growth concerns have created what it sees as a “buying opportunity.” 

Benchmark also cut its target, lowering it to $33 from $48, implying a 121% upside from the stock’s last close, while reiterating a ‘Buy’ rating. The firm said the selloff was “violent and largely disconnected” from comments made during the conference call. “It was prudence - a deliberate, preemptive action aimed at reducing Pagaya's exposure to tail risk,” the brokerage added.

PGY Q4 Print

Pagaya reported Q4 earnings per share (EPS) of $0.80, above the $0.77 consensus estimate, while Q4 revenue of $321 million missed the $349.5 million consensus.

For the first quarter (Q1) of 2026, the company expects revenue in the range of $315 million to $355 million, compared with a $344 million consensus, and adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) of $80 million to $95 million. 

For FY26, Pagaya forecasts revenue of $1.4 billion to $1.575 billion versus a $1.52 billion consensus, and adjusted EBITDA of $410 million to $460 million.

Pagaya Tightens Underwriting Amid Consumer Uncertainty

On the earnings call, CEO Gal Krubiner said Pagaya proactively tightened underwriting late in Q4 amid persistent consumer uncertainty. He said company data does not show consumer deterioration and that credit performance across asset classes remains in line with expectations, adding the pullback was aimed at reducing exposure to higher-risk credit deals that could carry larger losses in a downside scenario.

Meanwhile, CFO Evangelos Perros said the production adjustment reduced Q4 volume by about $100 million to $150 million without affecting profitability targets. 

Pagaya said it will diversify its capital base, expanding forward flow arrangements across personal loans, auto loans and point-of-sale financing, and building close to $3 billion of revolving capacity through revolving ABS structures. 

How Did Stocktwits Users React?

On Stocktwits, retail sentiment for Pagaya flipped to ‘extremely bullish’ from ‘bullish’ over the past day amid over a 2,500% surge in 24-hour message volume.

One user said, “Easiest trade in the market right now. This will 2x-3x in a matter of years. Buy your leaps now this is EZ money folks”

Another user said the stock’s move was “completely out of touch with fundamentals”

PGY stock has declined 14% over the past 12 months.

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