PAYPAL HOLDINGS INC (1PYPL.MI) Stock Fundamental Analysis
Europe - Euronext Milan - BIT:1PYPL - US70450Y1038 - Common Stock
48.845 EUR
+1.34 (+2.82%)
We assign a fundamental rating of 6 out of 10 to 1PYPL. 1PYPL was compared to 60 industry peers in the Financial Services industry. 1PYPL has an excellent profitability rating, but there are some minor concerns on its financial health. 1PYPL is not valued too expensively and it also shows a decent growth rate.
1. Profitability
1.1 Basic Checks
- In the past year 1PYPL was profitable.
- 1PYPL had a positive operating cash flow in the past year.
- Each year in the past 5 years 1PYPL has been profitable.
- 1PYPL had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
- Looking at the Return On Assets, with a value of 6.16%, 1PYPL belongs to the top of the industry, outperforming 83.33% of the companies in the same industry.
- Looking at the Return On Equity, with a value of 24.34%, 1PYPL belongs to the top of the industry, outperforming 86.67% of the companies in the same industry.
- Looking at the Return On Invested Capital, with a value of 14.11%, 1PYPL belongs to the top of the industry, outperforming 86.67% of the companies in the same industry.
- 1PYPL had an Average Return On Invested Capital over the past 3 years of 11.47%. This is in line with the industry average of 10.51%.
- The last Return On Invested Capital (14.11%) for 1PYPL is above the 3 year average (11.47%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 6.16% | ||
| ROE | 24.34% | ||
| ROIC | 14.11% |
ROA(3y)4.44%
ROA(5y)4.96%
ROE(3y)17.47%
ROE(5y)18.52%
ROIC(3y)11.47%
ROIC(5y)10.62%
1.3 Margins
- 1PYPL has a Profit Margin (14.96%) which is comparable to the rest of the industry.
- In the last couple of years the Profit Margin of 1PYPL has remained more or less at the same level.
- The Operating Margin of 1PYPL (19.16%) is better than 65.00% of its industry peers.
- In the last couple of years the Operating Margin of 1PYPL has grown nicely.
- With a Gross Margin value of 41.56%, 1PYPL perfoms like the industry average, outperforming 48.33% of the companies in the same industry.
- In the last couple of years the Gross Margin of 1PYPL has declined.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 19.16% | ||
| PM (TTM) | 14.96% | ||
| GM | 41.56% |
OM growth 3Y2.07%
OM growth 5Y2.92%
PM growth 3Y-7.41%
PM growth 5Y-1.18%
GM growth 3Y-4.8%
GM growth 5Y-2.04%
2. Health
2.1 Basic Checks
- The Return on Invested Capital (ROIC) is well above the Cost of Capital (WACC), so 1PYPL is creating value.
- The number of shares outstanding for 1PYPL has been reduced compared to 1 year ago.
- Compared to 5 years ago, 1PYPL has less shares outstanding
- 1PYPL has a worse debt/assets ratio than last year.
2.2 Solvency
- An Altman-Z score of 1.99 indicates that 1PYPL is not a great score, but indicates only limited risk for bankruptcy at the moment.
- 1PYPL's Altman-Z score of 1.99 is fine compared to the rest of the industry. 1PYPL outperforms 63.33% of its industry peers.
- 1PYPL has a debt to FCF ratio of 2.06. This is a good value and a sign of high solvency as 1PYPL would need 2.06 years to pay back of all of its debts.
- With a decent Debt to FCF ratio value of 2.06, 1PYPL is doing good in the industry, outperforming 80.00% of the companies in the same industry.
- 1PYPL has a Debt/Equity ratio of 0.56. This is a neutral value indicating 1PYPL is somewhat dependend on debt financing.
- 1PYPL has a Debt to Equity ratio (0.56) which is in line with its industry peers.
- Even though the debt/equity ratio score it not favorable for 1PYPL, it has very limited outstanding debt, so we won't put too much weight on the DE evaluation.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.56 | ||
| Debt/FCF | 2.06 | ||
| Altman-Z | 1.99 |
ROIC/WACC1.81
WACC7.81%
2.3 Liquidity
- A Current Ratio of 1.34 indicates that 1PYPL should not have too much problems paying its short term obligations.
- Looking at the Current ratio, with a value of 1.34, 1PYPL is in line with its industry, outperforming 56.67% of the companies in the same industry.
- A Quick Ratio of 1.34 indicates that 1PYPL should not have too much problems paying its short term obligations.
- With a decent Quick ratio value of 1.34, 1PYPL is doing good in the industry, outperforming 61.67% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.34 | ||
| Quick Ratio | 1.34 |
3. Growth
3.1 Past
- 1PYPL shows a slight negative growth in Earnings Per Share. In the last year, the EPS has decreased by -0.19%.
- 1PYPL shows quite a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 9.87% yearly.
- The Revenue has been growing slightly by 4.47% in the past year.
- 1PYPL shows quite a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 12.34% yearly.
EPS 1Y (TTM)-0.19%
EPS 3Y2.76%
EPS 5Y9.87%
EPS Q2Q%11.67%
Revenue 1Y (TTM)4.47%
Revenue growth 3Y7.82%
Revenue growth 5Y12.34%
Sales Q2Q%7.26%
3.2 Future
- Based on estimates for the next years, 1PYPL will show a quite strong growth in Earnings Per Share. The EPS will grow by 13.14% on average per year.
- The Revenue is expected to grow by 6.28% on average over the next years.
EPS Next Y9.71%
EPS Next 2Y8.71%
EPS Next 3Y9.86%
EPS Next 5Y13.14%
Revenue Next Year5.09%
Revenue Next 2Y5.41%
Revenue Next 3Y5.77%
Revenue Next 5Y6.28%
3.3 Evolution
- When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
- When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
4. Valuation
4.1 Price/Earnings Ratio
- The Price/Earnings ratio is 10.88, which indicates a very decent valuation of 1PYPL.
- Compared to the rest of the industry, the Price/Earnings ratio of 1PYPL indicates a somewhat cheap valuation: 1PYPL is cheaper than 71.67% of the companies listed in the same industry.
- When comparing the Price/Earnings ratio of 1PYPL to the average of the S&P500 Index (27.30), we can say 1PYPL is valued rather cheaply.
- Based on the Price/Forward Earnings ratio of 9.72, the valuation of 1PYPL can be described as reasonable.
- 66.67% of the companies in the same industry are more expensive than 1PYPL, based on the Price/Forward Earnings ratio.
- The average S&P500 Price/Forward Earnings ratio is at 24.32. 1PYPL is valued rather cheaply when compared to this.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 10.88 | ||
| Fwd PE | 9.72 |
4.2 Price Multiples
- Based on the Enterprise Value to EBITDA ratio, 1PYPL is valued a bit cheaper than 71.67% of the companies in the same industry.
- Based on the Price/Free Cash Flow ratio, 1PYPL is valued a bit cheaper than 75.00% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 9.61 | ||
| EV/EBITDA | 7.21 |
4.3 Compensation for Growth
- 1PYPL's PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
- 1PYPL has a very decent profitability rating, which may justify a higher PE ratio.
PEG (NY)1.12
PEG (5Y)1.1
EPS Next 2Y8.71%
EPS Next 3Y9.86%
5. Dividend
5.1 Amount
- With a yearly dividend of 0.99%, 1PYPL is not a good candidate for dividend investing.
- 1PYPL's Dividend Yield is comparable with the industry average which is at 1.95.
- Compared to an average S&P500 Dividend Yield of 1.82, 1PYPL's dividend is way lower than the S&P500 average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.99% |
5.2 History
Dividend Growth(5Y)N/A
Div Incr Years0
Div Non Decr Years0
5.3 Sustainability
DPN/A
EPS Next 2Y8.71%
EPS Next 3Y9.86%
PAYPAL HOLDINGS INC / 1PYPL.MI FAQ
Can you provide the ChartMill fundamental rating for PAYPAL HOLDINGS INC?
ChartMill assigns a fundamental rating of 6 / 10 to 1PYPL.MI.
What is the valuation status of PAYPAL HOLDINGS INC (1PYPL.MI) stock?
ChartMill assigns a valuation rating of 6 / 10 to PAYPAL HOLDINGS INC (1PYPL.MI). This can be considered as Fairly Valued.
What is the profitability of 1PYPL stock?
PAYPAL HOLDINGS INC (1PYPL.MI) has a profitability rating of 7 / 10.
Can you provide the PE and PB ratios for 1PYPL stock?
The Price/Earnings (PE) ratio for PAYPAL HOLDINGS INC (1PYPL.MI) is 10.88 and the Price/Book (PB) ratio is 2.65.