Morgan Stanley analysts adjusted their rating on Flywire Corporation (NASDAQ:FLYW) from Overweight to Equalweight, though they raised the price target from $27 to $30.
The analysts noted that Flywire’s premium valuation now aligns more closely with their initial investment thesis. Before the Q4/23 results, the analysts anticipated that stability in net dollar retention and the scale of new contributions would sustain growth beyond 29%, potentially driving the stock price toward the previous target.
Flywire demonstrated robust performance, with net revenue retention accelerating to 125% in 2023 from 124% in 2022, an increase in client acquisition, timely resolutions to delayed launches, gains in take rate amidst higher travel seasonality, and slight improvements in foreign exchange volumes in India. Despite Flywire’s commendable execution and the business’s appealing prospects, the analysts believe the current stock valuation reflects a balanced risk-reward scenario, prompting a neutral stance.