Paypal Holdings Intrinsic Value Calculation – Atlantic Equities Cautions Investors on PayPal Amid Growing Competition
June 23, 2023
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PAYPAL ($NASDAQ:PYPL): PayPal Holdings Inc. is a leading digital payments company based in San Jose, California. PayPal also provides the technology platform for merchants to accept digital payments, as well as access to consumer financing options. Unfortunately, the company’s success has led to increased competition in the payments space, and Atlantic Equities recently issued a report cautioning investors to move away from PayPal as a result. Atlantic Equities noted that the competitive landscape has changed significantly in recent years, with global players like Apple, Google, and Amazon introducing their own payments solutions, as well as the emergence of new regional players. These companies have put pressure on PayPal by offering innovative features and lower fees, which have reduced PayPal’s market share.
Moreover, Atlantic Equities highlighted that PayPal has been slow to respond to the competitive environment or to introduce new features. As a result, Atlantic Equities shifted its focus away from PayPal in its investment advice. While PayPal still boasts an impressive user base and maintains strong relationships with many banks and merchants, the company will need to respond quickly to the increased competition if it wants to maintain its market position. Investors should keep a close eye on how PayPal adapts to the changing environment and take heed of Atlantic Equities’ warning before making any decisions regarding their investments.
Share Price
On Tuesday, PAYPAL HOLDINGS opened at $63.6 and closed at $63.6, down by 0.3% from the last closing price of 63.7. Atlantic Equities have recently cautioned investors on investing in PayPal, citing the growing competition in the digital payments space. This includes a range of companies such as Square, Apple, and Google that are competing for market share and creating pressure on PayPal’s market dominance. As a result, Atlantic Equities claims that PayPal’s potential to grow in the future could be limited, given the competition. Live Quote…
About the Company
Income Snapshot
Below shows the total revenue, net income and net margin for Paypal Holdings. More…
| Total Revenues | Net Income | Net Margin |
| 28.07k | 2.71k | 11.2% |
Cash Flow Snapshot
Below shows the cash from operations, investing and financing for Paypal Holdings. More…
| Operations | Investing | Financing |
| 5.77k | -2.63k | -3.1k |
Balance Sheet Snapshot
Below shows the total assets, liabilities and book value per share for Paypal Holdings. More…
| Total Assets | Total Liabilities | Book Value Per Share |
| 77.19k | 57.33k | 17.69 |
Key Ratios Snapshot
Some of the financial key ratios for Paypal Holdings are shown below. More…
| 3Y Rev Growth | 3Y Operating Profit Growth | Operating Margin |
| 15.4% | 19.3% | 14.8% |
| FCF Margin | ROE | ROA |
| 18.1% | 12.9% | 3.4% |
Analysis – Paypal Holdings Intrinsic Value Calculation
At GoodWhale, we have conducted a thorough analysis of the fundamentals of PAYPAL HOLDINGS and have come to an interesting conclusion. Based on our proprietary Valuation Line, the intrinsic value of PAYPAL HOLDINGS share is estimated to be around $199.7. This suggests that PAYPAL HOLDINGS stock, which is currently trading at $63.6, is undervalued by 68.1%. In other words, there may be a good opportunity for investors to buy PAYPAL HOLDINGS stock at a relatively low price. More…
Peers
PayPal Holdings Inc is an American company operating a worldwide online payments system that supports online money transfers and serves as an electronic alternative to traditional paper methods like checks and money orders. The company operates as a payment processor for online vendors, auction sites, and many other commercial users, for which it charges a fee in exchange for benefits such as one-click transactions and password memory. PayPal’s primary competitors are Visa Inc, Mastercard Inc, American Express Co, and Discover Financial Services.
– Visa Inc ($NYSE:V)
Visa Inc is a global payments technology company that connects consumers, businesses, financial institutions, and governments in more than 200 countries and territories. Visa’s mission is to enable global commerce by making it easy, safe, and efficient for people and businesses to move money. The company’s products and services enable consumers and businesses to make purchases, send money, and accept payments. Visa also offers a suite of products and services for financial institutions, merchants, and government entities that help them to meet their customers’ needs.
Visa Inc had a market cap of 401.19B as of 2022. The company’s ROE was 31.6%. Visa Inc operates in more than 200 countries and territories and provides a wide range of products and services to consumers, businesses, financial institutions, and government entities.
– Mastercard Inc ($NYSE:MA)
Mastercard is a technology company that connects consumers, financial institutions, merchants, governments & businesses worldwide, enabling them to use secure & convenient electronic payments. As of 2022, Mastercard has a market cap of 295.32B and a Return on Equity of 110.3%. The company has been operational for over 50 years and is a leading player in the global payments industry. Mastercard is headquartered in Purchase, New York, United States.
– American Express Co ($NYSE:AXP)
American Express Co is a financial services company with a market cap of 104.64B as of 2022. The company provides credit cards, charge cards, and travelers’ cheques to consumers and businesses worldwide. It also operates a global merchant acquiring network. American Express Co was founded in 1850 and is headquartered in New York, New York.
Summary
PayPal Holdings is currently a popular stock amongst investors.
However, Atlantic Equities recently advised investors to move to the sidelines due to intensifying competition in the payments industry. With a large number of tech companies, banks, and fintechs all vying for market share, PayPal is facing increasing pressure to differentiate itself. As such, investors must thoroughly evaluate the potential risks of investing in the company before purchasing its stock. At the same time, the company’s strategic partnerships and product offerings may provide ample opportunities for continued growth. Ultimately, it is up to investors to assess their own personal risk tolerance and determine if PayPal is a good fit for their portfolios.
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