Remitly Global: Why This Fintech Darling Is Trading at a Bargain Valuation

The Market’s Overreaction to Slowing Growth

The recent selloff in fintech stocks has created an interesting opportunity for value-conscious investors. A wave of concerns about credit deterioration, rising delinquencies, and weakening consumer demand has pushed many digital payment companies lower—including Remitly Global (NASDAQ: RELY), which has plummeted nearly 25% following its latest earnings announcement. However, a closer examination of the fundamentals reveals the market may have been too harsh in its assessment.

The digital remittance leader reported Q3 results that tell a story of sustained expansion. Active users reached 8.9 million, reflecting a 21% year-over-year increase. More impressively, transaction volume climbed 35% to $19.5 billion, while revenue grew 25% to $419.5 million—exceeding analyst expectations by roughly $5.7 million. On the profitability front, adjusted EBITDA surged 29% to $61.2 million, and the company achieved positive GAAP earnings per share of $0.04.

Why the Business Model Offers Downside Protection

What makes Remitly particularly compelling during a fintech downturn is the nature of its revenue streams. Unlike lending platforms or buy-now-pay-later services burdened by credit risk, Remitly generates the majority of its income through transaction fees on cross-border remittances. This structural advantage means the company has significantly lower exposure to the loan losses and delinquencies plaguing other segments of the fintech ecosystem.

The addressable market opportunity remains enormous. As a digital-first alternative to legacy competitors like Western Union and MoneyGram, Remitly commands a $22 trillion total addressable market. The company continues to diversify its revenue streams through new initiatives, most notably Remitly One—a $9.99 monthly subscription launched in September that bundles send-now-pay-later functionality (up to $250 interest-free), a high-yield savings component (4% APY), and a foreign-transaction-fee-free debit card.

The Valuation Disconnect

Following the stock’s plunge, Remitly now trades at a forward price-to-sales ratio of just 1.7x—an exceptionally low multiple for a company growing revenue at 25% and expanding profitability at an even faster 29% clip. The stock also trades at approximately 11 times EBITDA on a projected full-year basis of $234-$236 million.

This disconnect between valuation and fundamentals suggests the market has extrapolated near-term guidance weakness into a broader narrative about the company’s long-term prospects. While management guided for 21% revenue growth in Q4—a deceleration from the recent 25% pace—and projected high-teen expansion for 2026, these figures still represent healthy expansion by historical standards.

The Path Forward

Remitly’s ability to lock in new subscribers through bundled offerings, expand into the business remittance segment, and maintain its competitive moat against traditional players positions it well for sustained outperformance. With the stock at multi-year lows despite accelerating profitability and a business model structurally insulated from credit cycles, the risk-reward proposition appears decidedly skewed toward investors willing to look past the near-term noise in fintech sentiment.