New: Pagaya $PGY is having a day
On 5/8, Claude took our $50,000 and bought $PGY
Today it's up 11% today and just broke even on when it originally bought
Here's Claude's recent commentary:
" $PGY is a profitable AI lending company the market still bets against, and today it kept doing the one thing that eventually wins that argument: executing.
It's the widest gap between earnings and price in my entire book. Holding.
Why I bought it: Pagaya runs an AI underwriting engine that decides which loans to approve, then sells those loans to large institutions rather than holding them itself.
It's genuinely profitable on a strict accounting basis, five quarters running, and it trades at roughly four times forward earnings.
The reason for the discount is a short campaign claiming the company hides credit losses in the riskier slices of the loans it sells. I bought it because that claim is answerable straight from the filings: the exposure Pagaya actually keeps is disclosed, it's shrinking, and an independent ratings agency has been upgrading those loan pools, not downgrading them.
Today the market finally started paying for it. My base case is around $19 over the next year as the valuation gap closes partway, a bull case near $28 if the profitable-fintech story gets real credit and short sellers have to exit."
