PayPal’s turnaround strategy has continued to drive the stock up, and it is now at its highest price since November 2022. The stock was at $89.3, an increase of 78% over its low point in 2023. Its market capitalization is now over $85 Billion.
PayPal is still a viable option
PayPal has faced pressure over the last few years, as the company’s growth rate has slowed.
The fintech industry has been crowded. Google Pay and Apple Pay are fierce competitors in its eponymous wallet.
Affirm Adyen and Stripe are among the companies that compete with its business unbranded.
PayPal has also had a difficult time adjusting to the new norm after experiencing strong growth in its business during the pandemic. The business grew by millions, and its revenue jumped from $17 Billion in 2019 to $20 Billion in 2020.
PayPal’s transformation under Alex Chriss appears to be working. Recent financial reports showed that PayPal’s transaction revenue increased by 6% during the third quarter. Venmo and Braintree were a big part of this.
The total revenue increased to $7.8 Billion, and the transaction margin to $3.6 Billion. PayPal is also a very profitable company. Its non-GAAP earnings per share (EPS) rose 22% in the past quarter to reach $1.2.
This quarter the company is expecting to have a good business, and revenue growth in low single digits.
Yahoo Finance reports that the average revenue forecast for the fourth quarter will be $8.27 Billion, which is a 3 % increase over the previous year. The company’s revenue for the year is estimated to be $31.71 Billion, an increase of 6% from last year.
In 2025 the company will be expected to earn over $33 Billion, an increase of 5.8% year-on-year. PayPal is likely to do better since they have a history of exceeding analyst estimates.
PYPL Stock: The Case for It
PayPal’s stock has greater upside despite its continued single-digit rate of growth.
The company’s value is fair. The company has a price-to earnings ratio that is 18.6, much lower than S&P 500’s 21. The valuation of Block is lower than that of other fintech firms like Visa, Mastercard and Block. The value is lower also than the average five-year figure of 30.
The company can also monetize millions of its users. The number of active users increased by 1% to 432 millions in the past quarter. It is a good sign that the company has been losing customers in successive quarters.
PayPal, thirdly, is still an established brand. It owns many of the most well-known businesses in the business. Venmo, PayPal and Braintree are all owned by PayPal.
PayPal Stock Price Forecast: PYPL Comeback Could be Epic
PayPal Stock Price Forecast
TradingView PYPL Chart
On the weekly chart, PYPL’s share price has formed an inverse “head and shoulders” pattern. The price has moved up above both the 50-week and 100-week moving averges, which is an indication that PYPL is getting more attention.
Stock is approaching Fibonacci Retracement levels of 23.6% at $105, which is approximately 23% higher than the current price. The MACD and Relative Strength Index have also continued to rise.
There are therefore increasing odds of the stock continuing to rise as bulls aim for the 50% retracement level at $180 which is approximately 101% higher than the current price. The bullish outlook will be invalidated if the stock drops below $71, the level of support.
The post PayPal Stock Price Analysis: Why it Could Double Soon may be updated as new information is revealed.