Markets

Why Paysign Stock Plunged Today

What happened

Shares of Paysign (NASDAQ: PAYS) fell 2.12% on Monday after the prepaid card program and processing services specialist reduced its annual revenue guidance.

More specifically, Paysign now expects full-year 2019 revenue of $35 million to $37 million -- up 50% to 58% year over year but down from its previous target range of $38 million to $40 million. Paysign blamed delays in onboarding new plasma-industry programs originally planned for the first half of 2019.

Stock market data with red arrow chart indicating losses.

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So what

Paysign noted the revenue shortfall stemming from those plasma program delays was partly offset by stronger-than-expected revenue from other pharmaceutical customers. Paysign also reiterated its outlook for 2019 adjusted EBITDA to be in the range of $10 million to $12 million. 

"Although we are disappointed that recent events have impacted our second-half revenue expectations, we remain excited about our continued growth and sales pipeline in both pharma and plasma, as well as opportunities in additional verticals," added Paysign CEO Marck Newcomer.

Now what

To be clear, Paysign still expects the aforementioned plasma programs to be live by the end of this month, after which it will enjoy a significantly larger monthly revenue stream from the plasma vertical. So while it's no surprise the market reacted negatively today -- and after considering the relative outperformance of Paysign's pharma programs in the meantime -- the delays should be of little concern for patient, long-term shareholders. As such, this drop could ultimately prove to be an attractive opportunity to open or add to a position in Paysign stock.

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Steve Symington has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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