Pitney Bowes Inc. (PBI): A Bull Case Theory

We came across a bullish thesis on Pitney Bowes Inc. on Pound the Rock Investing’s Substack. In this article, we will summarize the bulls’ thesis on PBI. Pitney Bowes Inc.'s share was trading at $9.79 as of December 1st. PBI’s trailing and forward P/E were 23.31 and 7.25 respectively according to Yahoo Finance.

Pitney Bowes (PBI) has quietly completed a multi-year transformation, exiting its unprofitable Global Ecommerce business, streamlining its cost structure, and reshaping both its C-suite and Board to focus on execution. The company is now fully concentrating on its two core businesses, which have a proven ability to generate strong cash flow. PBI has shifted from a struggling turnaround narrative to a clear execution story, with visible catalysts and materially reduced risks.

Under the leadership of a CEO with significant personal investment in the company, the risk/reward profile appears favorable at current market levels. With a market capitalization of $1.9 billion and an annualized free cash flow run rate of $350 million, the stock offers an attractive 18% free cash flow yield, a rare valuation for a well-known brand with sticky customer relationships, a captive bank, and category leadership in U.S. mail presort.

Even if the market does not fully re-rate the stock, investors can expect a compelling long-term return through dividends and aggressive share repurchases. The combination of a disciplined management team, strong cash-generating businesses, and shareholder-friendly capital allocation positions PBI as a unique investment opportunity with limited downside risk and multiple pathways for value realization.

The company’s focus on core execution and cash generation, along with its restructured governance, makes it well-positioned to deliver sustainable returns, while the current valuation provides an attractive entry point for both equity and income-oriented investors. Overall, Pitney Bowes represents a high-quality, cash-rich, and undervalued business with a compelling risk/reward profile.

Previously we covered a bullish thesis on Pitney Bowes Inc. (PBI) by Unemployed Value Degen in March 2025, which highlighted activist support, restructuring benefits, and a strong EBITDA outlook. The company’s stock price has depreciated approximately by 2.83% since our coverage. This is because the thesis hasn't played out. The thesis still stands as cash flow strength supports upside. Pound the Rock Investing shares a similar but emphasizes on PBI’s de-risked transformation.

Pitney Bowes Inc. is not on our list of the 30 Most Popular Stocks Among Hedge Funds. As per our database, 33 hedge fund portfolios held PBI at the end of the second quarter which was 34 in the previous quarter. While we acknowledge the potential of PBI as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you're looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock.

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Disclosure: None.