Nuvei CEO Philippe Fayer (Photo: courtesy)
What to do with the titles of Nuvei, Canadian Natural Resources and Constellation Software? Here are some analyst recommendations likely to move prices soon. Note: the author may have an opinion completely different from that expressed.
Nuvei Corporation (NVEI-Nasdaq, US$16.77): a very attractive stock at the current price according to the National Bank Financial analyst
National Bank Financial analysts recently met with the executives of Nuvei, an electronic payment solutions company based in Montreal, which is struggling with a sharp devaluation of its stock.
Remember that the stock which made its strong debut in October 2020 at US$38 touched US$160 a year later. It is only worth US$17 today.
The most recent cause of this volatility occurred when, in presenting its latest quarterly results, the company announced its decision to end its relationship with a major client, which forced it to revise downwards its growth forecasts as much. in the short and medium term, recalls Richard Tse, analyst at National Bank Financial.
Regardless of the causes of this volatility, it must be admitted that it is often repeated, and this is what brings Nuvei’s stock to a lower relative valuation than those of its competitors, explains the analyst. That being said, at 8.6 times the 2023 Enterprise Valuation (EV) multiple, the stock’s valuation is now very attractive, the analyst believes.
As for the meeting with management, the analyst’s attention was focused mainly on the risk that his forecasts would not come true, mainly in the short term, and on the comments as to whether the end of the relationship with one of its 10 largest customers is not likely to happen to others as well.
Satisfied with the meeting, he concluded that, all things considered, Nuvei is a very interesting company, and he maintains his “outperform” recommendation. Its one-year target price is unchanged at US$27.00.
