PayPal Holdings (PYPL) AI Stock Analysis

• Market Cap: $69.76B
• Dividend Yield: N/A
• Average Volume (3M): 14.97M
• Price to Earnings (P/E): 14.6
• Beta (1Y): 1.25
• Revenue Growth: 4.50%
• EPS Growth: 19.71%
• Country: US
• Employees: 24,400
• Sector: Financial
• Sector Strength: 70
• Industry: Financial - Credit Services
• EPS (TTM): 1.34
• Shares Outstanding: 955,378,400
• 10 Day Avg. Volume: 11,728,753
• 30 Day Avg. Volume: 14,965,674
• PEG Ratio: 4.53
• Price to Book (P/B): 4.30
• Price to Sales (P/S): 2.76
• P/FCF Ratio: 12.98
• Enterprise Value/Market Cap: 0.94
• Enterprise Value/Revenue: 2.00
• Enterprise Value/Gross Profit: 4.28
• Enterprise Value/Ebitda: 8.86
• 1Y Price Target: $84.26
• Price Target Upside: 15.39% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 32

• Rating: 78 Outperform
• Price Target: $80.00 ▲(9.56% Upside)

PayPal's strong financial performance and positive earnings call guidance are the most significant factors driving the score. Technical analysis and valuation provide a balanced view, while macroeconomic challenges and transaction losses present some risks.

Positive Factors

Strategic Partnerships

The partnership with Wix enhances PayPal's market position by integrating AI-driven commerce solutions, potentially increasing merchant adoption and transaction volume.

Revenue Growth

Venmo's accelerated revenue growth indicates strong consumer adoption and engagement, contributing to PayPal's overall revenue diversification and growth potential.

Cash Generation

Robust free cash flow supports PayPal's ability to invest in growth initiatives, maintain financial flexibility, and return value to shareholders through dividends and buybacks.

Negative Factors

Macro-economic Headwinds

Macroeconomic challenges may impact consumer spending and transaction volumes, potentially slowing PayPal's growth and affecting its financial performance.

Increased Transaction Losses

Rising transaction losses can erode profitability and signal potential issues in risk management, affecting long-term financial health.

Operational Cost Pressures

Decreasing EBIT margins indicate rising operational costs, which could pressure profitability if not managed effectively, impacting long-term sustainability.

PayPal Holdings Business Overview & Revenue Model

Company Description

PayPal Holdings, Inc. operates a technology platform that enables digital payments on behalf of merchants and consumers worldwide. It provides payment solutions under the PayPal, PayPal Credit, Braintree, Venmo, Xoom, Zettle, Hyperwallet, Honey, and Paidy names. The company's payments platform allows consumers to send and receive payments in approximately 200 markets and in approximately 100 currencies, withdraw funds to their bank accounts in 56 currencies, and hold balances in their PayPal accounts in 25 currencies. PayPal Holdings, Inc. was founded in 1998 and is headquartered in San Jose, California.

How the Company Makes Money

PayPal generates revenue primarily through transaction fees charged to merchants and consumers for processing payments. The company has several key revenue streams, including: 1) Transaction Fees: PayPal earns a percentage of each transaction processed through its platform, with fees varying based on transaction volume and payment methods. 2) Merchant Services: PayPal offers services such as payment processing, invoicing, and subscription billing to businesses, which contribute significantly to its revenues. 3) Interest and Fees on Loans: Through its PayPal Credit and Working Capital offerings, PayPal earns interest income and fees from loans extended to consumers and businesses. 4) Partnerships and Collaborations: PayPal has established partnerships with major platforms and financial institutions, enhancing its payment solutions and expanding its user base. The company's strategic acquisitions and integrations, such as the purchase of Venmo and Braintree, have also played a vital role in diversifying its revenue streams and driving growth.

PayPal Holdings Financial Statement Overview

Summary

PayPal exhibits strong financial health with consistent revenue growth and profitability. The balance sheet is stable with manageable leverage, and cash flow generation remains robust. Minor operational cost pressures are present, but the company is well-positioned for continued growth.

Income Statement

PayPal has shown consistent revenue growth with a TTM increase of 1.77% and a strong gross profit margin of 46.76%. The net profit margin has improved to 14.96% in the TTM, indicating enhanced profitability. However, the EBIT margin has slightly decreased from the previous year, suggesting some operational cost pressures.

Balance Sheet

The company's debt-to-equity ratio is stable at 0.56, reflecting a balanced approach to leverage. Return on equity is strong at 24.26%, indicating efficient use of equity to generate profits. The equity ratio stands at 25.31%, showing a solid equity base relative to total assets.

Cash Flow

PayPal's free cash flow has grown by 5.16% in the TTM, demonstrating robust cash generation capabilities. The operating cash flow to net income ratio is 1.31, indicating strong cash conversion. However, the free cash flow to net income ratio has slightly decreased, suggesting a need for careful cash management.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	32.86B	31.80B	29.77B	27.52B	25.37B	21.45B
Gross Profit	15.37B	14.66B	13.70B	13.77B	14.00B	11.78B
EBITDA	7.42B	6.74B	6.83B	4.99B	5.60B	6.46B
Net Income	4.92B	4.15B	4.25B	2.42B	4.17B	4.20B
Balance Sheet
Total Assets	79.80B	81.61B	82.17B	78.62B	75.80B	70.38B
Cash, Cash Equivalents and Short-Term Investments	10.76B	10.82B	14.06B	10.85B	9.39B	13.08B
Total Debt	11.28B	9.88B	9.68B	10.42B	9.05B	8.94B
Total Liabilities	59.60B	61.19B	61.12B	58.35B	54.08B	50.32B
Stockholders Equity	20.20B	20.42B	21.05B	20.27B	21.73B	20.02B
Cash Flow
Free Cash Flow	5.57B	6.77B	4.22B	5.11B	4.89B	5.35B
Operating Cash Flow	6.43B	7.45B	4.84B	5.81B	5.80B	6.22B
Investing Cash Flow	3.55B	1.59B	752.00M	-3.33B	-5.15B	-16.55B
Financing Cash Flow	-7.59B	-8.28B	-2.99B	-1.20B	-557.00M	12.45B

PayPal Holdings Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 73.02
• 50DMA: Positive
• 100DMA: Negative
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For PYPL, the sentiment is Negative. The current price of 73.02 is above the 20-day moving average (MA) of 70.25, above the 50-day MA of 69.02, and above the 200-day MA of 71.48, indicating a neutral trend. The MACD of 0.31 indicates Negative momentum. The RSI at 50.16 is Neutral, neither overbought nor oversold. The STOCH value of 53.57 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for PYPL.

PayPal Holdings Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
AXP	―	$246.76B	24.24	33.70%	0.88%	8.14%	9.55%
MA	―	$501.35B	38.18	177.90%	0.55%	14.55%	13.25%
PYPL	―	$69.76B	14.65	24.36%	―	4.50%	19.71%
V	―	$657.51B	34.01	51.67%	0.68%	11.34%	3.00%
XYZ	―	$48.88B	17.15	14.27%	―	1.41%	262.31%
Sector *	―	$18.00B	11.42	9.92%	3.81%	9.73%	1.22%
WU	―	$3.03B	4.12	97.70%	9.85%	-2.51%	17.47%

PayPal Holdings Corporate Events

PayPal’s Stock Buyback and Dividend Strategies: Potential Risks and Investor Implications

PayPal Holdings, Inc. faces potential business risks associated with its stock repurchase and dividend strategies. The company’s decision to engage in share repurchases and declare cash dividends is subject to the discretion of its Board of Directors and influenced by various factors such as market conditions and financial health. These actions could lead to increased stock price volatility and a reduction in cash reserves, posing a risk to investors. Additionally, the possibility of suspending or terminating these programs may negatively impact the trading price of PayPal’s common stock.

PayPal Reports Strong Q3 2025 Results and Initiates Dividend

PayPal Holdings, Inc. is a leading global financial technology company that facilitates digital and mobile payments for consumers and businesses worldwide, offering services such as online money transfers and payment processing solutions.

PayPal’s Earnings Call Highlights Growth Amid Challenges

The recent earnings call for PayPal Holdings, Inc. reflected a strong performance with significant growth in key areas such as Buy Now, Pay Later (BNPL) and Venmo. Despite these achievements, the company remains cautious due to macroeconomic challenges and increased transaction losses, which could impact future performance.

PayPal Announces Quarterly Cash Dividend Program

On October 28, 2025, PayPal announced the initiation of a quarterly cash dividend program, with the first dividend of $0.14 per share payable on December 10, 2025. This move highlights PayPal’s strategy to return capital to shareholders while continuing to invest in growth. The company reported strong financial results for the third quarter of 2025, with a 7% increase in net revenues and a 32% rise in GAAP EPS. PayPal also raised its full-year guidance, indicating confidence in its ongoing growth and strategic partnerships with companies like Google and OpenAI.

The most recent analyst rating on (PYPL) stock is a Hold with a $75.00 price target. To see the full list of analyst forecasts on PayPal Holdings stock, see the PYPL Stock Forecast page.

PayPal’s Strong Q2 2025 Results and Raised Outlook

PayPal Holdings, Inc. is a leading financial technology company that facilitates digital and mobile payments worldwide, offering services through its PayPal and Venmo platforms, among others, to both consumers and merchants. In its second quarter of 2025, PayPal reported robust financial results, highlighted by a 5% increase in net revenues to $8.3 billion and a significant rise in earnings per share, reflecting the company’s strategic initiatives and market expansion. Key performance indicators for PayPal included a 6% increase in total payment volume to $443.5 billion and a 7% growth in transaction margin dollars to $3.8 billion, alongside improvements in operating income and margins. The company also returned $1.5 billion to shareholders through stock repurchases. Looking ahead, PayPal has raised its full-year guidance, indicating confidence in continued growth driven by innovations and strategic transformations in its business model.

PayPal Earnings Call Highlights Growth Amid Challenges

The recent earnings call for PayPal Holdings, Inc. was marked by a positive sentiment, highlighting strong performance in key areas such as Venmo, Buy Now, Pay Later (BNPL), and the launch of new initiatives like PayPal World and Pay with Crypto. These developments indicate significant growth potential for the company. However, challenges from tariffs and increased transaction losses were noted as areas of concern that could impact future performance.