Macroeconomic tailwinds could work in this beaten-down growth stock's favor as consumer behavior adjusts.
PayPal has improved the EPS growth trajectory and is showing the same EPS growth momentum it had pre-pandemic. Between 2015 and 2019, the EPS grew from 0.8 to 2.1 which is equal to 22% CAGR and the recent EPS growth projections show a similar trend line. PayPal is investing close to $5 billion annually on buybacks which should improve EPS growth by 8%-10% on a standalone basis.
Goldman Sachs analyst Will Nance assumed PayPal Holdings PYPL with a Neutral rating and a price target of $69.
Paypal (PYPL) has received quite a bit of attention from Zacks.com users lately. Therefore, it is wise to be aware of the facts that can impact the stock's prospects.
Apple's new payment products released at the WWDC pose a direct threat to PayPal. PayPal continues to innovate enough for solid growth, but the payments company has failed to create the types of products to distinguish the company from competition like Apple Pay. The stock remains undervalued, trading at ~12x full non-GAAP EPS estimates, though the company has confused the market by now including SBC in estimates.
PayPal has been struggling with increasing its profitability. It now has a new CEO and is taking steps to change course.
Given PayPal's (NASDAQ: PYPL ) continued, strong growth and its large user base, along with the low valuation of PayPal stock, I continue to believe that the shares will deliver strong returns over the long term. What's more, the macroec0omic picture, although far from perfect for the company, should enable it to keep posting fairly strong financial results going forward.
PayPal stock is trading at a historically low multiple and deserves your attention.
The past three years have been tough for PayPal, one of Silicon Valley's oldest and largest fintech companies, a storied business that counts Elon Musk, Max Levchin, Peter Thiel and Reid Hoffman among its founders and early employees. Its stock has fallen 80% from the $360 billion all-time-high market value it hit in July 2021; the share of ecommerce sales worldwide that flow through its branded PayPal button has been eroding; and some of the company's recent attempts to rejuvenate its product lineup have gotten little respect from analysts.
The rise of digital payments and online shopping provides a strong tailwind to achieve more growth. Sizable free cash flow generation allows management to repurchase outstanding shares.
Paypal (PYPL) reachead $59.80 at the closing of the latest trading day, reflecting a +1.15% change compared to its last close.
PayPal has appointed Srini Venkatesan, the former head of Walmart's U.S. Omni Platforms and Tech organization, as chief technology officer (CTO), effective Monday (June 24). Venkatesan will succeed PayPal's current CTO, Archie Deskus, who has decided to leave PayPal, the company said in a Thursday (June 20) press release.