Remitly’s Opportunity to Take Share

RELY (update): Q2 FY26 beat top/bottom line again; incremental EBITDA margins hit 60% (highest in recent qtrs despite higher marketing), LTM avg mid-40s. 22%+ topline growth, ~45% TTM incremental margins, inflecting FCF, no debt, 10M+ QAU. Thesis: 'Moat Velocity' — 100% digital disruptor lowering/raising take rate to grab share while legacy WU (2x revenue) craters on margins/mix shift, cuts promo/marketing, saddled w/ $2.7B debt. Guidance: FY26 AEBITDA $412.5M, 80% FCF conversion (LTM FCF $388M flattered by NOLs); on track for Rule of 40. Growth drivers: high-value senders, Global Card, new products targeting 10%+ of rev by 2028. Trades ~13x FCF; author ups 2028 PT to $50 (Street $29–36); to single-digit FCF yield in 2 yrs. Wants more aggressive buyback (currently just offsets SBC). Risk: relies on continued marketing ROI (6:1) and new-product execution.

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