William Blair analyst Andrew Jeffrey has reiterated their neutral stance on PYPL stock, giving a Hold rating today.
Andrew Jeffrey’s rating is based on a combination of factors that reflect both opportunities and challenges for PayPal Holdings. The company has implemented a refocused growth strategy and improved profitability, supported by a strong balance sheet and a valuation that suggests limited downside risk. However, despite these positive aspects, Jeffrey expresses concerns about PayPal’s ability to meet its ambitious long-term growth targets due to intense competition and its late entry into new markets such as unified commerce.
Jeffrey also highlights the potential of PayPal’s new initiatives, including enhancements to the consumer experience and merchant conversion, which could drive growth in transaction volume and dollar value. Nonetheless, he remains skeptical about the company’s ability to achieve the projected growth rates, especially in the face of competition from major players like Apple Pay and Adyen. The uncertainty surrounding the monetization of Venmo and the potential challenges in increasing long-term transaction yields further contribute to the Hold rating, as these factors could hinder PayPal’s ability to differentiate itself in a competitive market.