Zack Buckley

Priority Technology (PRTH) trades around $5.50, roughly 4-5x true free cash flow, despite over 90% recurring or reoccurring revenue, 10%-plus growth in free cash flow per share, and a Treasury Solutions segment (built on the Finxera/CFTPay acquisition) that is about 60% of the business, earns 80%-plus EBITDA margins, has tripled EBITDA in four years, and is not at risk from AI because it is integrated financial infrastructure. Multiple valuation approaches - sum of the parts at roughly $17, a simpler multiple analysis at roughly $19, and the June Payoneer transaction at 8.3x EBITDA implying about $12 (a floor, since PRTH converts EBITDA to free cash flow better than Payoneer given lower stock-based comp, capex, and capitalized software) - all point far above the current price. The chairman/CEO's $6.00-$6.15 take-private proposal, made two days after a bad print knocked the stock from about $7 to about $5, is opportunistic and disconnected from intrinsic value; with the special committee advised by Barclays and Paul Weiss running a real process and recent private comps at 8-9x EBITDA or higher, risk/reward is asymmetric - roughly 10% upside to the standing bid in the worst case versus 100%-plus if fair value is realized, and even if the company stays public the stock should re-rate as investors appreciate the segments. Leverage (~3.8x net debt/EBITDA, in line with peers) is manageable and falling as debt is paid down each quarter.