RELY: Profitability Improvements And Upcoming Earnings Expected To Drive Momentum In 2025

Remitly Global's analyst price target has been lowered from $24.83 to $21.50 per share. Analysts cite tempered growth expectations and near-term uncertainties, despite ongoing profitability improvements and new strategic initiatives.

Analyst Commentary

Analyst opinions on Remitly Global reflect a mix of optimism about the company’s growth prospects and caution regarding near-term headwinds. Recent price target revisions and rating changes showcase both confidence in Remitly’s strategic initiatives and concerns about lingering uncertainties affecting the stock’s valuation.

Bullish Takeaways

• Bullish analysts see Remitly as a leading growth vehicle in the FinTech sector, citing its strong track record of scaling revenues and profitability ahead of expectations.
• Efforts to diversify revenue streams are viewed positively, with expectations that new product initiatives can help close the company’s valuation gap compared to industry peers.
• The company’s disciplined approach to profitability improvement continues to resonate, supporting upgraded performance ratings and anticipated higher future multiples.
• Several upcoming catalysts, such as product announcements and key earnings reports, could drive shares higher in the second half of 2025.

Bearish Takeaways

• Bearish analysts highlight concerns that recently released earnings guidance may signal limited near-term upside, casting doubt on the potential for meaningful outperformance in the next quarter.
• There are ongoing questions regarding the unit economics and long-term funding strategy of Remitly’s new lending products, adding an element of uncertainty to future growth projections.
• Persistent external factors, including the impact of immigration-related enforcement activity, continue to pose risks and may weigh on investor sentiment.
• Cautious analysts also point to the possibility that Street forecasts for 2026 revenues remain too optimistic given management’s recent statements.

What's in the News

• Remitly Global raised its earnings guidance for fiscal year 2025, projecting total revenue between $1.619 billion and $1.621 billion. This represents a 28% year-over-year increase, with positive GAAP net income expected (Key Developments).
• The company issued new earnings guidance for the fourth quarter of 2025, expecting total revenue in the range of $426 million to $428 million. This would be an increase of 21% to 22% year-over-year, and the company also expects positive GAAP net income (Key Developments).
• Remitly announced Remitly One, an all-in-one financial membership offering features such as Remitly Flex, Remitly Wallet, and a Remitly Card. The membership also includes new rewards and upcoming multi-currency and credit benefits for members. It is available for a monthly fee of $9.99 in the U.S. (Key Developments).
• The company held an Analyst/Investor Day, providing updates and engaging with the investment community (Key Developments).

Valuation Changes

• The consensus analyst price target has fallen significantly from $24.83 to $21.50 per share, reflecting moderated expectations.
• The discount rate has declined slightly, moving from 7.39% to 7.37%.
• Revenue growth projections have decreased from 19.37% to 17.56%.
• Net profit margin expectations have risen, improving from 5.59% to 6.46%.
• The future P/E multiple has decreased from 51.3x to 40.2x, reflecting a more conservative earnings outlook.