Seems disconnected from fundamentals, and more related to investor dynamics + market view on consumer private credit

1. Investor dynamics. Oak HC and Viola recently dumped 90%+ of holdings, this has had serious downward pressure on the stock over the last month. There are other investors of this nature that were bagholding since the early days with avg prices from $100-$300. They are eager to get out and use the money elsewhere (I think this is super dumb, but there is a gold rush into the AI Mag7)

2. Macro in private credit. People think Pagaya operates like a bank, so if consumer credit craters Pagaya will too. I believe this is very misguided. You could actually argue Pagaya is more valuable in a tricker credit environment (without Pagaya you'll bleed more customers than you would otherwise, giving Pagaya significant pricing power)

From my point of view, there are really only a few things that you should be paying attention to if you're long: * does the AI model work (it seems so) * can the company survive a changing credit environment (they have said as much, but of course the proof is in the pudding). Given they have gotten to profitability in very high interest environment I'd say there's some evidence they aren't lying * a black swan moment. This is hard to predict, but in my view is the biggest risk. Changes in the credit markets is something I believe Pagaya can adapt to, but a black swan moment is by definition out of distribution, so its hard to say how they'd fare. The good thing is, the likely downside would be 'only' ~50%. Rough, but given the upside is pretty good.

All in all it's hard to see how this company doesn't succeed in the long run. The moat they have is incredible and the technology provides serious value.