Wondering how to pick strong, market-beating stocks for your investment portfolio? Look no further than the Zacks Style Scores.
PayPal is undervalued due to an unclear narrative, despite its broad reach and strong fundamentals in the digital payments space. Recent management focus on core, high-margin segments like PayPal and Venmo, plus improved execution, signal a positive strategic shift. With a low multiple and potential for mid-teens earnings growth, PayPal offers significant upside if it continues to consolidate and simplify its business.
PayPal remains a top pick due to profitable growth, aggressive share repurchases, and a strong balance sheet despite market pessimism. Management signals unbranded processing growth has bottomed, with accelerating momentum in Venmo and branded processing supporting future growth. The stock trades at just 13x earnings, offers a 7% shareholder yield, and looks undervalued even without growth acceleration.
Branded checkout TPV grew 5% YoY FX-neutral, with 60% of U.S. traffic on the upgraded checkout experience. Venmo TPV rose 12%, revenue exceeded 20% growth, and debit card monthly active users surged 40% in Q2 2025. PSP (Braintree) TPV increased 2% FX-neutral as low-margin volumes were deprioritized to protect profitability and improve transaction margins.
Stalling revenue growth, now dragging in low single digits after years of double-digit gains, is, in my view, the main factor keeping PayPal's stock under pressure. Other contributing factors include a recent drop in operating and free cash flows, although there is a caveat here. I believe the $6–7 billion free cash flow target will survive only if the $1.2 billion working capital spike that we've seen over the past six months unwinds.
Investors interested in Financial Transaction Services stocks are likely familiar with Paypal (PYPL) and MasterCard (MA). But which of these two stocks is more attractive to value investors?
Former Amazon and Google Pay executive Ben Volk is headed to PayPal. “I'm thrilled to announce that I'm joining PayPal as the SVP & GM of PayPal Consumer, focusing on how we show up and deliver value for the millions of people who use PayPal every day,” Volk wrote in a Tuesday (Aug.
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.
PayPal beat Q2 sales and profit expectations, showing strong operating and transaction margin growth and raising its 2025 profit guidance by 50%. The company's account base continues to expand, with 438 million users, reflecting renewed growth and improved customer quality. PayPal trades at a steep discount to fintech peers, with a forward P/E of 11.6x, despite robust profitability and margin expansion.
PayPal remains deeply undervalued, trading at low valuation multiples despite solid growth and strong fundamentals, making it a compelling long-term investment opportunity. Recent Q2 results beat estimates and guidance was raised, but the market overreacted to short-term metrics like declining free cash flow and slower account growth. Buybacks are accelerating, reducing share count and boosting EPS, while initiatives like Buy Now, Pay Later and PayPal World offer significant future growth potential.
PayPal remains highly profitable and is growing revenue, defying the market's negative narrative and recent share price declines. The company is deeply undervalued, trading at a significant discount to peers, despite strong free cash flow and double-digit EPS growth projections. Buybacks have failed to create shareholder value; I strongly advocate for a substantial dividend program to attract new investors and income-focused ETFs.
PayPal (NASDAQ:PYPL) has posted a solid Q2 2025 with revenue and EPS better than expected. Full-year guidance reaffirmed. Temporary weakness in free cash flow is explained by working capital timing. Continued aggressive share repurchases, Venmo and Braintree growth, and the pursuit of crypto initiatives suggest a strong long-term outlook for the company.