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    Does Pagaya Technologies' (PGY) Latest ABS Deal Reveal Durable Funding Strength or Cyclical Tailwind?

    Simply Wall St·12/13/2025 16:35:57
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    • Pagaya Technologies recently closed PAID 2025-8, a AAA-rated US$500 million asset-backed securitization backed by consumer loans originated on its network, bringing its year-to-date ABS funding for personal loans to about US$5.40 billion.
    • The deal, which attracted broad investor participation, highlights ongoing confidence in Pagaya’s AI-driven credit platform and its ability to consistently secure large-scale funding in the securitization market.
    • Next, we’ll explore how this latest US$500 million ABS issuance may affect Pagaya’s investment narrative and future funding flexibility.

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    Pagaya Technologies Investment Narrative Recap

    To own Pagaya, you have to believe its AI-driven credit engine can keep attracting lending partners and investors while managing credit and regulatory risk. The new US$500 million AAA ABS deal supports the near term catalyst of funding reliability and cost of capital, but it does not remove the key risk that any deterioration in model performance or consumer credit could quickly test that confidence.

    The recent US$1.26 billion shelf registration for Class A shares sits alongside Pagaya’s growing ABS activity, giving it more options to raise capital as it pursues new bank and fintech partnerships and product expansion. How the company balances equity issuance with securitization and debt will matter for dilution, returns on future growth investments and its ability to sustain momentum in partner onboarding.

    Yet even with strong securitization demand, investors should be aware that if model performance weakens or defaults rise...

    Read the full narrative on Pagaya Technologies (it's free!)

    Pagaya Technologies’ narrative projects $1.8 billion revenue and $311.7 million earnings by 2028. This requires 17.0% yearly revenue growth and an earnings increase of about $594 million from -$282.4 million today.

    Uncover how Pagaya Technologies' forecasts yield a $40.50 fair value, a 78% upside to its current price.

    Exploring Other Perspectives

    PGY 1-Year Stock Price Chart
    PGY 1-Year Stock Price Chart

    Seven Simply Wall St Community fair value estimates for Pagaya span from US$34.05 to US$323.82 per share, reflecting very different expectations. You can set those views against the central risk that any stumble in AI-driven underwriting or higher than expected defaults could challenge funding access and partner growth, with clear consequences for the company’s long term performance.

    Explore 7 other fair value estimates on Pagaya Technologies - why the stock might be a potential multi-bagger!

    Build Your Own Pagaya Technologies Narrative

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    This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.