Bruce Point Short
Shares of Nuvei Corp, a Canadian payments firm, slipped after short seller Spruce Point Capital Management published a negative report questioning the company’s financial transparency, links with failed crypto platform FTX, and its recent acquisition of Paya Holdings Inc. The report, which caused Nuvei’s stock to drop about 6% initially, cited the potential for a 35% to 50% drop in value. This is the second time in two years that Spruce Point has targeted Nuvei.
Spruce Point, which has disclosed that it is shorting Nuvei’s stock, raised concerns about Nuvei’s acquisition of Paya Holdings Inc., stating that Paya was losing market share and experiencing slowing revenue growth. Spruce Point also raised questions about Nuvei’s relationship with FTX, a failed crypto platform, and alleged lack of financial transparency.
Canadian actor Ryan Reynolds announced that he has invested in Nuvei and has done marketing work for the company in online videos. Reynolds stated that he likes the fintech sector and sees payments as a critical and ubiquitous aspect of the industry.
Nuvei’s CEO, Philip Fayer, declined to provide details of Reynolds’ investment arrangement with the company on Bloomberg Television, but praised Reynolds for making a technical and boring topic fun and humorous.
Not all analysts are convinced by Spruce Point’s report, with Keefe Bruyette & Woods analyst Sanjay Sakhrani stating that the short seller’s allegations lack material and provable issues. Sakhrani noted that while Spruce Point has an investigative approach, it is difficult for him to connect the dots and find evidence of any significant problems with Nuvei.
Nuvei’s stock initially dropped about 6% in response to Spruce Point’s report but later pared losses to trade down 2% at $41.60 as of 2:26 p.m. New York time, indicating that the market’s reaction may not have been as severe as initially anticipated.
The controversy surrounding Nuvei and Spruce Point’s report highlights the ongoing debate between short sellers and company supporters, with conflicting views on the company’s financial health and future prospects. Investors should carefully consider all available information and conduct their own research before making investment decisions. As with any investment, there are risks involved, and it is important to seek professional advice and thoroughly evaluate the merits and risks of any investment opportunity.
NVEI Stock Forecast & Analysis
Based on the Nuvei Corp stock forecast from 6 analysts, the average analyst target price for Nuvei Corp is CAD 57.54 over the next 12 months. Nuvei Corp’s average analyst rating is Strong Buy. Stock Target Advisor’s own stock analysis of Nuvei Corp is Slightly Bullish , which is based on 8 positive signals and 5 negative signals. At the last closing, Nuvei Corp’s stock price was CAD 56.84. Nuvei Corp’s stock price has changed by +4.03% over the past week, +0.73% over the past month and -32.04% over the last year.