D.A. Davidson maintains CPI Card Group stock buy rating at $34

D.A. Davidson has reaffirmed its Buy rating on CPI Card Group (NASDAQ:PMTS) with an unchanged price target of $34.00. The rating upgrade came following a secondary public offering, where affiliates of Parallel49 Equity sold their remaining shares. Parallel49 Equity sold 2.7 million shares at $21.50 each, including over-allotment.

D.A. Davidson sees this as a positive move, reducing potential overhang and improving the company's float. The stock price has since risen from the offering price to $24.06. However, the shares have fallen 11.8% in the past week. Despite this, CPI Card Group's float has expanded, as noted by the firm. According to InvestingPro, the stock is currently undervalued, trading below its Fair Value.

The platform provides 11 additional ProTips for PMTS, including information on its strong year-over-year return. The company reported solid second-quarter 2026 results, with revenue of $149.18 million, beating estimates of $143.88 million. However, EPS fell to $0.17 compared to the forecasted $0.53. CPI Card Group highlights improvements in gross margins and record first-half cash flow of $36 million.

The company also raised its revenue growth and free cash flow outlook for the year, attributing success to the Arroweye acquisition and TRISM instant issuance business. CPI Card Group announced a secondary offering of 2,337,323 shares, with a 30-day option for underwriters to buy up to 350,598 additional shares. This follows a 15% year-over-year revenue increase and a 7% rise in adjusted EBITDA to $24 million. Analysts have not yet issued upgrades or downgrades based on these developments.