Latest news with #PYPL
Yahoo
2 days ago
- Business
- Yahoo
PayPal, Big Ten & Big 12 Conferences Partner for Student-Athlete Revenue Sharing
PayPal Holdings Inc. (NASDAQ:PYPL) is one of the undervalued S&P 500 stocks to buy according to hedge funds. On June 26, PayPal announced multi-year partnerships with the Big Ten and Big 12 Conferences to revolutionize the distribution of institutional payments from universities directly to student-athletes under a new revenue-sharing model. The initiative allows athletic departments to securely and efficiently disburse funds through PayPal. The Big 12's agreement with PayPal is valued at ~$100 million over 5 years, which amounts to ~$1 million per school annually. The collaboration follows a recent court decision permitting colleges and universities to share revenue directly with student-athletes. A consumer in a cafe paying for goods using a mobile payment app. The first phase of the rollout is expected to begin in the summer of 2025, with student-athletes starting to receive these institutional payments via PayPal as early as July 1. PayPal is also set to become a preferred payment partner for tuition payments at select schools and offer students and parents a convenient and flexible payment option starting in early 2026. PayPal Holdings Inc. (NASDAQ:PYPL) is a technology platform that enables digital payments for merchants and consumers worldwide. While we acknowledge the potential of PYPL 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 . READ NEXT: and . Disclosure: None. This article is originally published at Insider Monkey. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Business Insider
5 days ago
- Business
- Business Insider
PayPal Holdings (PYPL) Receives a Hold from TD Cowen
TD Cowen analyst Bryan Bergin maintained a Hold rating on PayPal Holdings (PYPL – Research Report) today. The company's shares closed yesterday at $73.58. Confident Investing Starts Here: Easily unpack a company's performance with TipRanks' new KPI Data for smart investment decisions Receive undervalued, market resilient stocks right to your inbox with TipRanks' Smart Value Newsletter Bergin covers the Technology sector, focusing on stocks such as Accenture, Exlservice Holdings, and Genpact. According to TipRanks, Bergin has an average return of 2.0% and a 47.70% success rate on recommended stocks. PayPal Holdings has an analyst consensus of Moderate Buy, with a price target consensus of $80.07, an 8.82% upside from current levels. In a report released yesterday, Piper Sandler also initiated coverage with a Hold rating on the stock with a $74.00 price target. PYPL market cap is currently $71.56B and has a P/E ratio of 16.51. Based on the recent corporate insider activity of 38 insiders, corporate insider sentiment is negative on the stock. This means that over the past quarter there has been an increase of insiders selling their shares of PYPL in relation to earlier this year. Earlier this month, Diego Scotti, the EVP, GM, Consumer Group of PYPL sold 3,839.00 shares for a total of $281,129.97.
Yahoo
21-06-2025
- Business
- Yahoo
Why PayPal Stock Is a Screaming Buy for the Second Half of 2025
PayPal stock (PYPL) has had a bumpy ride since 2020. The stock more than doubled in 2020 and continued its good run in the first half of 2021. However, PYPL ended that year in the red, meeting the same fate for the next two years. 2024 was a welcome break for PayPal investors as the 'law of averages' finally caught up with the stock, and it gained a respectable 39%, outperforming the S&P 500 Index ($SPX) after three consecutive years of underperformance. Cut to 2025, and PYPL stock has already lost nearly 20% and is yet again massively underperforming the broader market, which has recovered from its April lows. I see the recent fall in PayPal stock as a good buying opportunity, as we'll explore in this article. Dear Tesla Stock Fans, Mark Your Calendars for June 30 The 'Golden Era' for Tesla Starts June 22. Should You Buy TSLA Stock First? This Options Tool Can Show You How to Trade Tesla Stock Ahead of Robotaxi Day Markets move fast. Keep up by reading our FREE midday Barchart Brief newsletter for exclusive charts, analysis, and headlines. PayPal started the year on a strong note but fell sharply after its Q4 2024 earnings. While the company posted better-than-expected revenues and profits for the quarter, and its guidance came in ahead of estimates, slowing growth at Braintree, its subsidiary focused on card processing, dampened sentiment. The tariff chaos did not help, as fintech companies, including Affirm (AFRM) and PayPal, slumped in April amid concerns that tariffs could lead to a recession, hurting their business. Both these stocks have not yet recovered to their 2025 highs, even as tariff worries have greatly (if not fully) subsided. While these are short-term headwinds, PayPal is facing some structural challenges in the form of higher competition across nearly all its business verticals. For instance, its branded checkout is facing intense competition from Apple Pay (AAPL) and Google Pay (GOOG), while the non-branded business faces competition from companies like Stripe. The P2P business is also facing competition from Zelle and Cash App (XYZ). The competition has negatively impacted PayPal's topline, which is now growing in single digits. With rising competition, digital payment companies have been feeling pressure on their take rate (the fees they charge for processing the transaction), and PayPal's operating margins have fallen. While I find corporate turnarounds a cliché, PayPal is a legit turnaround story under the new CEO, Alex Chriss, who is working on profitable growth. The strategy has shown results, and the company has had five consecutive quarters of profitable growth. PayPal has also made a foray into digital advertising, capitalizing on the vast consumer data that it possesses. The company is also using artificial intelligence to personalize experiences for customers. PayPal is transforming into a 'commerce company' from a mere payment company, and aspires to be a bridge connecting its over 400 million users to the merchants on the platform. During the Investor Day earlier this year, Chriss said that the pivot could help PayPal deliver annual adjusted earnings per share (EPS) growth of over 20% in the future. The investing thesis for PayPal is three part. The first is the turnaround and transformation, which is a work in progress The initial stages of this turnaround have been promising. The second is, of course, valuation, as PayPal's current forward price-earnings (P/E) multiple of 13.5x is well below the S&P 500 Index. Also, despite the slowdown, the company's bottom line is still growing, and the P/E-to-growth multiple of 1.13x looks quite attractive. Finally, PayPal is a free cash flow powerhouse despite all the challenges, and expects to generate between $6 billion-$7 billion of free cash in 2025. The company has been using the bulk of this cash flow to repurchase its shares and intends to spend $6 billion on buybacks this year. Given PayPal's current market cap of just over $66 billion, the buybacks will theoretically help boost its EPS by high single digits. PayPal's cash engine is not expected to slow down anytime soon, and it intends to use between 70%-80% of its free cash flows toward repurchases over the medium term, which should help propel its EPS growth in low-teens, if not higher. The company's balance sheet is also quite formidable, and it holds more cash and investments than the debt it owes. Overall, I find PayPal stock a no-brainer at these levels and am adding to my existing position in the company. While it is no longer the kind of growth story it was a few years back, there is a lot of comfort in these valuations, and the turnaround can help lead to a re-rating. Sell-side analysts also see decent upside in PYPL stock, and its mean target price of $80.50 is 17.4% higher than the June 18 closing price. The overall Street sentiment is mixed, though, and of the 44 analysts covering the stock, 16 have a 'Strong Buy' rating while three rate PYPL as a 'Moderate Buy.' 21 analysts rate PayPal as a 'Hold' while the remaining four rate it as a 'Strong Sell.' On the date of publication, Mohit Oberoi had a position in: PYPL, AFRM, GOOG, AAPL. All information and data in this article is solely for informational purposes. This article was originally published on
Yahoo
21-06-2025
- Business
- Yahoo
Should PayPal be on my list of shares to buy?
On the face of it, PayPal (NASDAQ:PYPL) ought to be on my list of shares to buy. The company has a market value of $69bn and has generated just under $6bn in free cash in the last year. With minimal debt, that implies a free cash flow yield of almost 9%. That's pretty high considering the business isn't in decline – but there's a catch when it comes to the valuation. With no dividend, PayPal returns cash to shareholders via share buybacks. These work by reducing the outstanding share count, increasing the value of each of the remaining shares. Since 2020, PayPal's returned over $20bn via share repurchases. That's around 30% of its current market value and the returns have been going up. Year Share Buybacks 2024 $6bn 2023 $5bn 2022 $4.2bn 2021 $3.4bn 2020 $1.6bn Despite this, the company's share count has only fallen by about 13% over the last five years. That's much less impressive and it raises an important question for investors. PayPal's share count isn't really going down much despite the firm using almost all the free cash it generates to buy back shares. So where's the money going? A big part of the answer is stock-based compensation. This is where PayPal issues shares to pay its staff part of their salaries in the firm's stock, rather than cash. A lot of companies do this and I don't think there's anything intrinsically wrong with it. But it's something that investors need to factor into their calculations. Since 2020, PayPal's issued around $6.5bn in stock to cover these expenses. And this has gone some way towards offsetting the cash the firm's been using for share buybacks. In 2024, the company spent almost $6bn on repurchasing shares, but just over 20% of this was offset by stock-based compensation. So the outstanding share count only fell by around 6%. Stock-based compensation doesn't involve cash leaving the business directly. As a result, some investors tend to think it isn't a real expense. I however, think this is a mistake. Issuing equity automatically reduces the value of share buybacks and this is a key mechanism companies can return cash to shareholders. This is especially true when it comes to PayPal. Its 9% free cash flow yield's attractive at first sight, but the firm can't just use this to bring down its share count by that amount every year. Before it can start bringing down its number of shares outstanding, it has to buy back the ones it issued. And it has to do that with cash, making it a very real expense for investors. I don't think PayPal's stock-based compensation is a reason to dismiss the stock out of hand immediately. And the company's undergoing an interesting shift in terms of its priorities. Focusing on margins over revenue growth could boost profits and integrating further into the online transaction process could boost its competitive position. These are potential positives. For the time being though, I think there are better opportunities available. While the stock looks like a bargain at first sight, I don't think it's as attractive for me as it seems. The post Should PayPal be on my list of shares to buy? appeared first on The Motley Fool UK. More reading 5 Stocks For Trying To Build Wealth After 50 One Top Growth Stock from the Motley Fool Stephen Wright has no position in any of the shares mentioned. The Motley Fool UK has recommended PayPal. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors. Motley Fool UK 2025 Error while retrieving data Sign in to access your portfolio Error while retrieving data Error while retrieving data Error while retrieving data Error while retrieving data
Forbes
18-06-2025
- Business
- Forbes
Buy PayPal Stock At $70?
CANADA - 2025/02/12: In this photo illustration, the PayPal logo is seen displayed on a smartphone ... More screen. (Photo Illustration by Thomas Fuller/SOPA Images/LightRocket via Getty Images) PayPal (NASDAQ:PYPL) shares have underperformed this year, falling approximately 17% year-to-date, in contrast to the S&P 500, which has risen around 2% during the same timeframe. PayPal's financial results have been varied. In Q1 2025, the firm reported earnings of $1.33 per share, surpassing expectations, although revenue fell short, totaling $7.8 billion—an increase of only 1% year-over-year—due to the company's focus on profitability over volume, leading to a reduction in its lower-margin revenue streams. The U.S. trade conflict has affected PayPal by creating economic uncertainty that may curb consumer spending and adversely impact cross-border e-commerce and payment volumes, which are essential for PayPal's income. Additionally, competition has been intensifying with platforms such as Apple Pay and Shopify making inroads into online checkout, which challenges PayPal's market leadership. Nonetheless, PayPal stock appears quite appealing at its current market price of approximately $71. We reach this assessment by evaluating the present valuation of PYPL shares alongside its operational performance in recent years and its current as well as historical financial health. Our evaluation of PayPal based on critical metrics of Growth, Profitability, Financial Stability, and Downturn Resilience indicates that the firm possesses a strong operational performance and financial standing, as outlined below. However, if you are looking for potential gains with less volatility than individual stocks, the Trefis High Quality portfolio offers an alternative option - it has outperformed the S&P 500 and yielded returns surpassing 91% since its launch. Based on what one pays per dollar of sales or profit, PYPL stock appears slightly undervalued relative to the broader market. • PayPal boasts a price-to-sales (P/S) ratio of 2.3 compared to a figure of 3.0 for the S&P 500 • Furthermore, the company's price-to-free cash flow (P/FCF) ratio stands at 9.9, while the S&P 500 registers at 20.5 • Additionally, it has a price-to-earnings (P/E) ratio of 17.8 as opposed to the benchmark's 26.4 PayPal's Revenues have experienced some growth in recent years. • PayPal's top line has grown at an average rate of 7.8% over the past 3 years (versus a 5.5% increase for the S&P 500) • Its revenues have increased by 6.8% from $30 billion to $32 billion in the last 12 months (in comparison to 5.5% growth for the S&P 500) • Additionally, its quarterly revenues grew by 4.2% to $7.8 billion in the latest quarter from $7.7 billion a year earlier (compared to a 4.8% increase for the S&P 500) PayPal's profit margins are approximately at the median level for firms in the Trefis coverage universe. • PayPal's Operating Income during the previous four quarters was $5.8 billion, representing a moderate Operating Margin of 18.1% (versus 13.2% for the S&P 500) • PayPal's Operating Cash Flow (OCF) for this duration was $7.5 billion, indicating a moderate OCF Margin of 23.4% (versus 14.9% for the S&P 500) • For the last four-quarter period, PayPal's Net Income was $4.1 billion, which demonstrates a moderate Net Income Margin of 13.0% (compared to 11.6% for the S&P 500) PayPal's balance sheet appears robust. • PayPal's Debt stood at $9.9 billion at the close of the most recent quarter, while its market capitalization is $70 billion (as of 6/13/2025). This results in a strong Debt-to-Equity Ratio of 13.4% (compared to 19.9% for the S&P 500). [Note: A lower Debt-to-Equity Ratio is preferred] • Cash (including cash equivalents) accounts for $11 billion of the $81 billion in Total Assets for PayPal. This results in a strong Cash-to-Assets Ratio of 13.3% (versus 13.8% for the S&P 500) PYPL shares have felt an effect that was slightly worse than the S&P 500 index during certain recent downturns. While investors remain hopeful for a mild landing by the U.S. economy, what could transpire if another recession occurs? Our dashboard How Low Can Stocks Go During A Market Crash illustrates how key stocks performed during and after the last six market crashes. • PYPL shares declined 41.9% from a high of $308.53 on July 23, 2021, to $179.32 on December 1, 2021, compared to a peak-to-trough decline of 25.4% for the S&P 500 • The stock is still not back to its pre-Crisis high • The highest price the stock achieved since then was 197.35 on December 8, 2021, and it is currently trading around $71 • PYPL shares fell 20.3% from a peak of $121.30 on July 24, 2019, to $96.64 on October 23, 2019, contrasted with a peak-to-trough drop of 33.9% for the S&P 500 • The stock completely rebounded to its pre-Crisis peak by February 14, 2020 In conclusion, PayPal's performance across the outlined parameters is summarized as follows: • Growth: Strong • Profitability: Neutral • Financial Stability: Very Strong • Downturn Resilience: Neutral • Overall: Strong This correlates with the stock's moderate valuation, which leads us to conclude that it is fairly priced, suggesting that the stock could be a relatively solid buy. Although there may be some potential upside for PYPL shares, the Trefis Reinforced Value (RV) Portfolio has outperformed its all-cap stocks benchmark (comprised of the S&P 500, S&P mid-cap, and Russell 2000 benchmark indices), delivering strong returns to investors. Why does this happen? The quarterly rebalanced mix of large-, mid-, and small-cap RV Portfolio stocks has offered a responsive means to capitalize on favorable market conditions while mitigating losses when markets decline, as detailed in RV Portfolio performance metrics.
