The Federal Reserve (Fed) cut interest rates again, making it the third straight cut in its last three meetings this year. Now there are many consequences that will flow from this latest twist as they make their way through the economy. One thing is for sure: stocks that contribute to this transition are likely to see their prices rise.
This is where the business services sector comes into play, as fluctuations in foreign exchange rates and interest rates will inevitably affect the purchasing power of domestic businesses and consumers, as well as those operating in foreign markets. Although online platforms such as Shopify Inc. NEW YORK: STORE This topic may be at the forefront of investors’ minds, but vertical games such as payment systems are still not popular enough.
PayPal today
(As of 5:45 p.m. ET)
- 52 week range
- $55.77
▼
$93.66
- P/E ratio
- 20.79
- Target price
- $88.42
That’s why the shares PayPal Holdings Inc. NASDAQ: PYPL today are an attractive offer; The company’s services will be at the center of a storm in the coming months as online business activity and order fulfillment begin to pick up and create more demand.
Wall Street analysts and some institutional investors would agree, but before investors learn these facts, they should start by understanding what’s driving PayPal stock right now.
Quarterly results point the way for PayPal
PayPal’s investor presentation for its most recent quarter highlighted some of the key trends that provide further momentum and upside potential for the stock. Now that the stock is trading at 96% of its 52-week high, the media is willing to acknowledge PayPal’s key performance indicators (KPIs) when a lower share price has rendered them worthless.
Here are some of the key KPIs investors should keep in mind today, starting with total payment volume (TPV). Over the past 12 months, TPV has grown by as much as 9%, which is far from expected due to the slowdown in business and a figure that will undoubtedly continue to rise in this new business cycle.
Then there’s the revenue generated from these transactions, $7.8 billion, or 6% more than the previous year. Investors can rest assured of this result as PayPal’s monthly active account count, which just reached 223 million, grew 2%, accompanied by an impressive 61.4 million transactions per active account, up 9% over the past 12 months.
It would seem that as inflationary pressures persist in the United States economy, more and more consumers are looking to reduce their costs by purchasing more products through these online platforms that primarily rely on PayPal to process payments.
Moreover, the need to find freelance work or extra income online for extra income during inflation also helps PayPal as most of these online jobs also rely on PayPal for their payment processing services.
Wall Street Analysts Applaud and Agree with PayPal’s Trends
Despite PayPal shares rising up to 46% over the past 12 months, Wall Street analysts still believe the company can stage another double-digit rally. In recent weeks, staff at Macquarie and Barclays have decided to go public with their optimistic views.
PayPal Stock Forecast Today
$88.42
Growth potential 1.48%Moderate purchase
Based on ratings from 36 analysts
| High forecast | $115.00 |
|---|---|
| Average forecast | $88.42 |
| Low forecast | $60.00 |
PayPal Stock Forecast Details
As of December 2024, Barclays analysts maintained an Overweight rating on PayPal shares, while estimating the stock to $110. According to Macquarie, the ratings are more like outperform and a price target of $115 per share; Given these two recent views, investors face a net upside potential of 28.7% to 34.5%, respectively.
With all of these bullish factors coming together, investors may note that up to $5.7 billion of institutional capital has flowed into PayPal shares over the past 12 months, fueling expectations for even higher prices in the future. Of course, these expectations go beyond analyst ratings and price action; there are numbers to back them up.
For example, the same analysts are now forecasting earnings per share (EPS) of $1.27 for the same quarter next year, compared to the current consensus of $1.07. Achieving an earnings per share growth rate of up to 19% is enough for the stock price to test new highs.
The icing on the cake for investors is PayPal’s stock valuation compared to today’s peers. On a price-to-book (P/B) multiple, PayPal’s valuation of 4.8x would be well below the computer sector average of 7.8x today, and this discount makes PayPal an excellent risk/reward proposition given its inherent growth and potential growth. in this today.
Before you consider PayPal, you should hear this.
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