Paragon Banking Group

PAG.L

Financial - Mortgages · Financial Services

Exchange

London Stock Exchange

Winston Score

Winston is curious

Mixed quality — meaningful strengths and weaknesses.

Data as of Aug 23, 2026 · filings through Mar 31, 2026

How the score breaks down

Quality

Mixed

Growth

Mixed

Cash Flow

Exceptional

Stability

Weak

Valuation

Good

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Winston Score History

The full picture

Paragon Banking Group is a UK-based bank that specialises in lending money to landlords and small businesses. Its main products are buy-to-let mortgages, which help property investors finance rental homes, and loans for small and medium-sized companies. It does not operate a large network of high-street branches like traditional banks.

Paragon makes money by charging interest on the loans it provides, earning the difference between what it pays to borrow funds and what it charges customers. It operates almost entirely in the United Kingdom and has a market value of around £1.4 billion. Its focus on specialist lending to landlords gives it a niche position, but this also means it is heavily exposed to the UK property market and changes in interest rates. A key risk is that rising mortgage costs or a slowdown in the rental property market could reduce demand for its core buy-to-let products and increase loan defaults.

Growth Profile

For growth stock investors

When traditional metrics don't capture the full picture, these are the signals growth stock investors use instead.

Revenue Growth

+139.2% YoY

YoY Growth Rate

Revenue accelerating

EPS Growth

+4.0% YoY

YoY Growth Rate

Slow EPS growth

Insider Activity

4.4%ownership

↓ Declining

Insider ownership declining — could be dilution or selling

Cash Position

Cash flow positive

£19.6B cash & investments

Quarterly Free Cash Flow

↑ Burn rate improving

Company generates more cash than it spends — no dilution risk from fundraising

Revenue accelerating

Paragon Banking Group grew revenue 139% year-over-year and the growth rate is speeding up. That's the kind of momentum growth investors look for — the question is whether margins can follow.

The Winston Score above measures business quality today. Growth stocks often score lower because they invest in the future rather than maximising current profits. These metrics show what matters most for evaluating that future.

Score breakdown

Every number that matters to educated investors.

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Quality

Profit per sale

Gross Margin

37.9%

Modest — 37.9% gross margin

Profit after running costs

Operating Margin

22.4%

Excellent — 22.4% operating margin

Return on the money invested

ROCE

6.2%

Weak — 6.2% return on capital

ROIC between 5% and 15%. They earn 5 to 15 cents back per year on every dollar invested.

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Growth

Sales growth

Sales YoY

+113.9%

Fast-growing sales (+113.9% YoY)

Profit growth

EPS YoY

-8.0%

Earnings shrinking (-8.0% YoY)

Slight earnings drop. Typical near a cyclical low.

How steady the profit is

EPS Consistency

4/8 quarters

Earnings inconsistent quarter-to-quarter

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Cash Flow

Profit that turns into cash

Cash Conversion

200%

Turns 200% of profit into real cash

Spare cash per sale

FCF Margin

29.9%

Converts sales into free cash efficiently (29.9%)

Free cash flow margin above 20%. Out of every $100 in sales, more than $20 is real cash they keep.

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Stability

What it owes vs what it owns

Debt / Equity

1.63

Elevated debt (1.63)

Covers its interest

Interest Cover

0.36x

Dangerous — barely covers interest (0.4x)

Interest coverage below 1. Their profits don't cover the interest bill.

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Valuation

Price vs profit

P/E Ratio (TTM)

8.8x

no trend

Attractive valuation — P/E 8.8

P/E under 10. The price tag is small relative to last year's profit.

Cheaper or dearer next year

P/E vs Forward

N/A

not available

Data not available

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Dividends

Not applicable for this business.

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