Paysafe (PSFE) Stock Forecast & Price Target

Paysafe is attractive because its specialized, high-risk end markets create a durable moat and pricing power, while the two-sided ecosystem linking Merchant Solutions and Digital Wallets supports cross-sell opportunities and expansion in iGaming. In 2Q26, revenue was $447M and adjusted EBITDA was $103M, with Merchant Solutions growing 6% organically to $246M on strong iGaming volumes and the first multi-year recurring data licensing deal adding higher-quality revenue. Digital Wallets also held up with $206.6M of revenue, 7.8M active users, and a 36.2% EBITDA margin, while leverage of 5.3x and $44.8M in free cash flow still leave room for further balance-sheet improvement.

Paysafe is facing a more fragile fundamental setup as revenue merely met expectations while margin pressure worsened, with adjusted EBITDA margins contracting 150 bps year over year and Digital Wallets growth slowing to 3% reported and 1% organic as ARPU fell 5% to $26. The balance sheet and earnings outlook also weakened, as net leverage rose to 5.3x in 2Q26, FY26 adjusted EPS guidance was cut to $1.90-$2.03 from $2.12-$2.32, and the recent debt refinancing adds about $25M in annual interest expense. Further downside risk comes from elevated restructuring and litigation-related cash costs, including $18.6M of added restructuring costs year over year and an expected $39M cash payment in 2H, while the company still relies on a 2H ramp amid exposure to high-risk, heavily regulated verticals.