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BMO raises Remitly share price target to $28 highlighting strong Q4

EditorEmilio Ghigini
Published 02/22/2024, 06:32 PM
© Reuters.
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On Thursday, BMO Capital Markets adjusted its stance on Remitly Global Inc (NASDAQ:RELY), elevating the company's stock rating from Market Perform to Outperform and increasing the price target to $28 from the previous $24. The upgrade was prompted by Remitly's fourth-quarter results, which showcased stable marketing efficiency on a quarter-over-quarter basis, customer growth that exceeded expectations, and the potential for significant future operating leverage.

The analyst at BMO Capital highlighted that the initial concerns regarding the impact of marketing spend on near-term results have been alleviated by Remitly's strong performance in the fourth quarter. According to the analyst, the market may be underestimating the long-term growth prospects and EBITDA margin trajectory of Remitly. The positive surprise in the fiscal year 2024 guidance and the prospects for surpassing longer-term consensus expectations have contributed to the upgraded outlook.

As a result of the recent developments, BMO Capital has revised its forward adjusted EBITDA estimates for Remitly upwards by approximately 11-14%. This revision reflects a more optimistic view of the company's financial health and its ability to generate earnings before interest, taxes, depreciation, and amortization.

Remitly, which operates in the financial technology sector, is likely to benefit from the improved perception of its growth and profitability potential. The new price target of $28 suggests a higher level of confidence in the company's ability to perform well in the upcoming periods.

Investors and market watchers will be keeping a close eye on Remitly's performance to see if it aligns with BMO Capital's upgraded expectations and whether the company can continue to demonstrate the operational efficiencies and customer growth that have led to this positive reassessment.

This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.

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