What Happened?
Shares of restaurant technology provider PAR Technology (NYSE: PAR) jumped 3.6% in the morning session after the company received an upgrade from brokerage BTIG, which raised its rating to 'Buy' from 'Neutral' and set a $65 price target. The brokerage highlighted the restaurant software provider's strong sales pipeline and its ability to secure large enterprise deals as key drivers for potential annual growth exceeding 15% over the next three years. BTIG's analyst, Andrew Harte, noted that the upgrade follows a recent 25% drop in PAR's stock price, which was influenced by a lowered growth outlook and investor concerns after its latest earnings report. Despite the company missing earnings per share estimates, its revenue grew 43.8% year-over-year. BTIG sees the recent pullback as an attractive entry point for investors.
After the initial pop the shares cooled down to $52.80, up 1.9% from previous close.
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What Is The Market Telling Us
PAR Technology’s shares are quite volatile and have had 17 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful but not something that would fundamentally change its perception of the business.
The previous big move we wrote about was 2 days ago when the stock gained 4% on the news that stocks continued to rally as investor optimism grew for a potential Federal Reserve interest rate cut in September. This optimism was largely fueled by a recent consumer price index report that showed inflation easing, along with public comments from Treasury Secretary Scott Bessent advocating for a significant 50-basis-point rate cut. The prospect of lower borrowing costs tends to boost rate-sensitive sectors like Business Services, as it can encourage companies to increase spending on consulting, IT projects, and staffing.
PAR Technology is down 26.2% since the beginning of the year, and at $52.80 per share, it is trading 34.9% below its 52-week high of $81.14 from November 2024. Investors who bought $1,000 worth of PAR Technology’s shares 5 years ago would now be looking at an investment worth $1,490.
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