NASDAQ:PYPL stands out as a growth opportunity that won't break the bank.

Take a closer look at PAYPAL HOLDINGS INC (NASDAQ:PYPL), an affordable growth stock uncovered by our stock screener. NASDAQ:PYPL boasts strong growth prospects and excels in financial health indicators, all while maintaining a reasonable valuation. Let's break it down further.

A Closer Look at Growth for NASDAQ:PYPL

ChartMill assigns a Growth Rating to each stock, ranging from 0 to 10. This rating is determined by analyzing different growth elements, including EPS and revenue growth, spanning both historical and future figures. In the case of NASDAQ:PYPL, the assigned 7 reflects its growth potential:

• PYPL shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 23.73%, which is quite impressive.
• Measured over the past years, PYPL shows a quite strong growth in Earnings Per Share. The EPS has been growing by 16.12% on average per year.
• PYPL shows quite a strong growth in Revenue. In the last year, the Revenue has grown by 8.19%.
• The Revenue has been growing by 14.02% on average over the past years. This is quite good.
• PYPL is expected to show quite a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 15.88% yearly.
• The Revenue is expected to grow by 11.06% on average over the next years. This is quite good.

Assessing Valuation for NASDAQ:PYPL

An integral part of ChartMill's stock analysis is the Valuation Rating, which spans from 0 to 10. This rating evaluates diverse valuation factors, including price to earnings and cash flows, while considering the stock's profitability and growth. NASDAQ:PYPL has received a 5 out of 10:

• Compared to the rest of the industry, the Price/Earnings ratio of PYPL indicates a somewhat cheap valuation: PYPL is cheaper than 67.65% of the companies listed in the same industry.
• Compared to an average S&P500 Price/Earnings ratio of 26.09, PYPL is valued rather cheaply.
• PYPL is valuated rather cheaply when we compare the Price/Forward Earnings ratio to 22.45, which is the current average of the S&P500 Index.
• PYPL's Enterprise Value to EBITDA ratio is a bit cheaper when compared to the industry. PYPL is cheaper than 75.49% of the companies in the same industry.
• Based on the Price/Free Cash Flow ratio, PYPL is valued a bit cheaper than the industry average as 65.69% of the companies are valued more expensively.
• PYPL has a very decent profitability rating, which may justify a higher PE ratio.

How do we evaluate the Health for NASDAQ:PYPL?

ChartMill employs a unique Health Rating system for all stocks. This rating, ranging from 0 to 10, is determined by analyzing various liquidity and solvency ratios. For NASDAQ:PYPL, the assigned 6 for health provides valuable insights:

• Looking at the Altman-Z score, with a value of 1.86, PYPL is in the better half of the industry, outperforming 74.51% of the companies in the same industry.
• The Debt to FCF ratio of PYPL is 2.59, which is a good value as it means it would take PYPL, 2.59 years of fcf income to pay off all of its debts.
• The Debt to FCF ratio of PYPL (2.59) is better than 74.51% of its industry peers.
• A Debt/Equity ratio of 0.46 indicates that PYPL is not too dependend on debt financing.

Understanding NASDAQ:PYPL's Profitability

Discover ChartMill's exclusive Profitability Rating, a proprietary metric that assesses stocks on a scale of 0 to 10. It takes into consideration various profitability ratios and margins, both in absolute terms and relative to industry peers. Notably, NASDAQ:PYPL has achieved a 7:

• PYPL has a better Return On Assets (5.17%) than 82.35% of its industry peers.
• PYPL's Return On Equity of 20.17% is amongst the best of the industry. PYPL outperforms 86.27% of its industry peers.
• With an excellent Return On Invested Capital value of 11.03%, PYPL belongs to the best of the industry, outperforming 87.25% of the companies in the same industry.
• PYPL had an Average Return On Invested Capital over the past 3 years of 10.00%. This is above the industry average of 7.81%.
• The last Return On Invested Capital (11.03%) for PYPL is above the 3 year average (10.00%), which is a sign of increasing profitability.
• PYPL's Profit Margin of 14.26% is fine compared to the rest of the industry. PYPL outperforms 65.69% of its industry peers.
• The Gross Margin of PYPL (39.59%) is better than 60.78% of its industry peers.

More Affordable Growth stocks can be found in our Affordable Growth screener.

Our latest full fundamental report of PYPL contains the most current fundamental analsysis.

Disclaimer

This article should in no way be interpreted as advice in any way. The article is based on the observed metrics at the time of writing, but you should always make your own analysis and trade or invest at your own responsibility.