Nayax's (NYAX) 2026 free cash flow conversion guidance, that was reduced to 5% to 10% from 40% previously, reflects the company's accelerated investments in financial services offerings, Lynkwell, securing memory and processing settlements, UBS said in a Tuesday research note.
While Nayax believes these investments and the resulting working capital impact to be one-time in nature, UBS said that improvement to the prior targeted 40% level could take time as the company remains focused on investments opportunities along with uncertainty around memory cost inflation and potential impacts in H2 2027.
Among positives, UBS noted that Nayax recently filed for a Connecticut Innovation Bank charter, which if approved, will provide a single regulatory framework for corporate cards, controlled-spend programs and working-capital solutions in the US.
UBS lowered its price target to $70 from $75 and maintained its neutral rating on the company's stock.
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