The true value lies somewhere between the worst case and best case scenarios. We take the average of these two methods to estimate the intrinsic value as accurately as possible. Our system is conducting in-depth analyses to map out the stock’s valuation journey. PayPal’s brands now include Xoom, Zettle, Hyperwallet, Honey, Happy Returns by PayPal, Chargehound, Paidy, and Simility.
- Millions of small and large retailers, online and in the real world, accept PayPal payments.
- Compared to the Zacks Consensus Estimate of $7.39 billion, the reported revenues represent a surprise of +0.37%.
- Users need an email address to sign up for an account and must provide a credit card, debit card, or bank account to complete the setup.
- The company’s technology enables people to make digital payments to other PayPal users and merchants that accept PayPal.
- For convenience, users may append the code generated by the hardware key to their password in the login screen.
At the center of everything we do is a strong commitment to independent research and sharing its profitable discoveries with investors. This dedication to giving investors a trading advantage led to the creation of our proven Zacks Rank stock-rating system. Since 1988 it has more than doubled the S&P 500 with an average gain of +24.18% per year. These returns cover a period from January 1, 1988 through January 1, 2024.
Is it the right time to buy PayPal’s stock?
Whether a stock’s current price rightly reflects the intrinsic value of the underlying business and the company’s growth prospects is an essential determinant of its future price performance. The size of the recent change in the consensus estimate, along with three other factors related to earnings estimates, has resulted in a Zacks Rank #3 (Hold) for Paypal. For the next fiscal year, the consensus earnings estimate of $5.50 indicates a change of +10.6% from what Paypal is expected to report a year ago.
And when a stock’s fair value is higher than its current market price, investors tend to buy the stock, resulting in its price moving upward. Because of this, empirical studies indicate a strong correlation between trends in earnings estimate revisions and short-term stock price movements. It is reasonable to expect, if no significant change happens to the e-commerce sector, PayPal stock price will continue its constant climb upwards. While nothing is certain, it is reasonable to expect electronic payments and digital currencies to become even more popular. Paypal’s acquisition of Venmo has also put them in a better position, capturing the millennial market. With a 50% growth in the PayPal stock price since the beginning of the 2017, the company is already occupying a large portion of the electronic industry and it doesn’t look like they will be slowing down any time soon.
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The company adjusted its revenue growth outlook for the fourth quarter and year to 7-8% from 8.5%, with approximately 75 basis points of margin expansion. Non-GAAP EPS for the full year is expected to grow by 21% https://bigbostrade.com/ to $4.98, and free cash flow is projected to be at least $4.6 billion. The earnings call highlighted strategic priorities for 2024, including a return to growth in customer base and efficient expense management.
It could eventually start allocating some of that cash toward dividend payments. The 2022 speed bump caused shares to plunge, which has the stock trading at a very reasonable valuation. PayPal’s improving profitability, value-enhancing share repurchases, and attractive valuation mean it could be an incredibly enriching stock to buy for the long term. PayPal is a leading digital payment platform that’s highly profitable and growing fast. Although PayPal’s profits dipped in 2022, the company expects earnings to resume their upward trajectory in 2023.
PayPal Estimates* in USD
As of January 15th, there was short interest totaling 19,550,000 shares, a decrease of 15.4% from the December 31st total of 23,110,000 shares. Based on an average daily volume of 17,400,000 shares, the short-interest ratio is currently 1.1 days. Dan Shulman was tapped as CEO-designee in 2014 and worked with the company extensively during the build-up to the IPO. Since then, Mr. Shulman has worked diligently as CEO to democratize and transform digital payments for the benefit of individuals, families, and businesses worldwide. PayPal Holdings, Inc. is one of the world’s largest and oldest fintech companies having gotten its start in 1998.
Is PayPal profitable?
For convenience, users may append the code generated by the hardware key to their password in the login screen. This method is required for some services, such as when using PayPal through the eBay application on iPhone. PayPal (PYPL -3.66%) is a leader in digital payments, which is why many investors seek to invest in PayPal stock. The company’s technology enables people to make digital payments to other PayPal users and merchants that accept PayPal. PayPal offers businesses a range of solutions for their day-to-day operations. This includes payment portals for online and in-person transactions, business management services, and credit and financing options.
More than 10 million new individual investors have entered the market in the first half of this year, roughly matching last year’s record level, according to estimates from JMP Securities. A combination of stay-at-home orders during the pandemic, government stimulus checks and viral events like the rise of GameStop in January have spurred on new interest in the stock market. © 2024 Market data provided is at least 10-minutes delayed and hosted by Barchart Solutions. Information is provided ‚as-is‘ and solely for informational purposes, not for trading purposes or advice, and is delayed. To see all exchange delays and terms of use please see Barchart’s disclaimer. MarketBeat’s analysts have just released their top five short plays for February 2024.
According to one source, PayPal has held already discussions with potential industry partners. The San Jose, California-based company recently hired brokerage industry veteran Rich Hagen as part of the move, according to one of the sources. After leaving Ally Invest, Hagen is now the CEO of a previously unreported division of PayPal called Invest at PayPal, according to his LinkedIn page. Hagen was the co-founder of online brokerage TradeKing, which was bought by Ally Invest.
The change in the P/E multiple reflects the effect of changes in investor expectations and sentiment towards the company. A higher P/E multiple means that investors are willing to pay more for each dollar of earnings, indicating higher expectations for future growth. An early version of PayPal as we know was launched in the late 1990s as a payments system for Palm Pilot users by a software company called Confinity. The company later merged with X.com—an online banking company—and officially took the PayPal name in 2000. PayPal’s stock looks dirt cheap at 9 times forward earnings, and its insiders have bought nearly 50% as many shares as they’ve sold over the past 12 months.
The ETFMG Prime Mobile Payments ETF (IPAY -2.26%) had the largest allocation to PayPal stock in late 2023 at 5.5%. forex expert advisor Once you complete the order page, click the Place Order button at the bottom and become a PayPal shareholder.
Originally a payment processing application named Confinity, the company will join forces with eBay in 2000 and then merge with the company in 2002. In 2008 Bill Me Later joined the company and eventually became Paypal Credit, the company also launched mobile apps that year that made it even easier and more accessible to millions of consumers. However, that doesn’t mean PayPal can’t be a good stock to own for the long term. It generates lots of free cash flow it uses to expand and repurchase its attractively priced shares. Meanwhile, PayPal’s cost-cutting efforts should improve its profitability, potentially boosting its stock price. Earnings were under pressure due to heavy investments in its platform to improve the customer experience.
PayPal’s total number of active accounts reached a peak of 435 million in the fourth quarter of 2022, but declined sequentially throughout 2023 to just 428 million in its latest quarter. Its revenue grew 21% in 2020 and 18% in 2021, but rose a mere 8% in 2022. PayPal’s troubles started nearly six years ago, when its former parent company eBay (EBAY -2.10%) decided to replace PayPal with its smaller Dutch rival Adyen (ADYE.Y -1.65%) as its preferred payment platform. That transition, which happened gradually over the following five years, throttled PayPal’s revenue growth. No investment decision can be efficient without considering a stock’s valuation.
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