Shares in Pexa Group Ltd (ASX: PXA) are higher on Tuesday after the company outlined changes to its Digital Solutions division.
At the time of writing, the Pexa share price is up 4.83% to $14.54.
The stock is now up around 7% for 2026, with today’s move marking one of its stronger single-day gains this year.
The rally follows an announcement released after market close on Monday.
Exit from Digital Solutions confirmed
In its update, Pexa confirmed it will exit its majority-owned Digital Solutions businesses. These assets will be classified as “held for sale” and treated as discontinued operations.
The decision follows a previously announced strategic review, in which management concluded that Pexa is not the best long-term owner of those businesses. Instead, the company will concentrate capital and resources on its core Exchange platform across Australia and the United Kingdom.
Pexa expects to recognise around $26 million in net impairments as part of the exit. It also flagged significant items of between $7 million and $8 million in the first half of FY26, excluding the impairment.
Despite the one-off charges, investors appear focused on the clearer earnings profile.
Pexa has begun the divestment of majority-owned Value Australia, which is expected to be completed by mid-2026.
FY26 guidance updated
Alongside the restructure, Pexa restated its FY26 guidance to reflect discontinued operations and the performance of its core business.
On a restated basis, group revenue is now expected to be between $395 million and $415 million, compared to previous guidance of $405 million to $430 million.
Group EBITDA margin is forecast at 34% to 37%, up from the earlier 32% to 35% range.
Core net profit after tax from continuing operations is now expected to be between $15 million and $25 million. Previously, guidance was for $5 million to $15 million.
Group capex remains at $50 million to $55 million, while international operating cash flow is expected to be between negative $59 million and negative $63 million.
For the first half of FY26, Pexa expects significant items of between $7 million and $8 million, excluding the $26 million impairment.
Cost savings and upcoming results
The company said the divestment will enable greater focus on its core Exchange operations. It plans to direct capital and resources toward growth in Australia and the United Kingdom.
The company is also undertaking a cost optimisation program in Australia, which is expected to deliver more than $10 million in annual cash savings.
Digital Solutions products that align with the Exchange business will be absorbed into the Australian segment. FY25 comparatives have been restated to reflect the revised structure.
Management said further detail will be provided at its first-half FY26 results on 27 February 2026.
The post Why the Pexa share price is on the rise today appeared first on The Motley Fool Australia.
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Motley Fool contributor Aaron Teboneras has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended PEXA Group. The Motley Fool Australia has positions in and has recommended PEXA Group. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.