PAYPAL HOLDINGS INC (2PP.DE) Stock Fundamental Analysis
FRA:2PP - Deutsche Boerse Ag - US70450Y1038 - Common Stock - Currency: EUR
Taking everything into account, 2PP scores 5 out of 10 in our fundamental rating. 2PP was compared to 50 industry peers in the Financial Services industry. 2PP scores excellent on profitability, but there are some minor concerns on its financial health. 2PP has a decent growth rate and is not valued too expensively.
1. Profitability
1.1 Basic Checks
In the past year 2PP was profitable.
In the past year 2PP had a positive cash flow from operations.
Each year in the past 5 years 2PP has been profitable.
2PP 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 5.08%, 2PP is in the better half of the industry, outperforming 68.00% of the companies in the same industry.
2PP's Return On Equity of 20.31% is fine compared to the rest of the industry. 2PP outperforms 78.00% of its industry peers.
2PP's Return On Invested Capital of 13.55% is amongst the best of the industry. 2PP outperforms 84.00% of its industry peers.
The Average Return On Invested Capital over the past 3 years for 2PP is in line with the industry average of 11.19%.
The last Return On Invested Capital (13.55%) for 2PP is above the 3 year average (11.47%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 5.08% | ||
| ROE | 20.31% | ||
| ROIC | 13.55% |
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
Looking at the Profit Margin, with a value of 13.04%, 2PP is in line with its industry, outperforming 58.00% of the companies in the same industry.
2PP's Profit Margin has been stable in the last couple of years.
2PP has a better Operating Margin (18.12%) than 70.00% of its industry peers.
2PP's Operating Margin has improved in the last couple of years.
2PP has a Gross Margin of 40.54%. This is comparable to the rest of the industry: 2PP outperforms 46.00% of its industry peers.
2PP's Gross Margin has declined in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 18.12% | ||
| PM (TTM) | 13.04% | ||
| GM | 40.54% |
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 below the Cost of Capital (WACC), so 2PP is destroying value.
Compared to 1 year ago, 2PP has less shares outstanding
The number of shares outstanding for 2PP has been reduced compared to 5 years ago.
The debt/assets ratio for 2PP is higher compared to a year ago.
2.2 Solvency
An Altman-Z score of 1.94 indicates that 2PP is not a great score, but indicates only limited risk for bankruptcy at the moment.
With a Altman-Z score value of 1.94, 2PP perfoms like the industry average, outperforming 54.00% of the companies in the same industry.
The Debt to FCF ratio of 2PP is 1.64, which is an excellent value as it means it would take 2PP, only 1.64 years of fcf income to pay off all of its debts.
With a decent Debt to FCF ratio value of 1.64, 2PP is doing good in the industry, outperforming 72.00% of the companies in the same industry.
2PP has a Debt/Equity ratio of 0.48. This is a healthy value indicating a solid balance between debt and equity.
Looking at the Debt to Equity ratio, with a value of 0.48, 2PP is in line with its industry, outperforming 46.00% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.48 | ||
| Debt/FCF | 1.64 | ||
| Altman-Z | 1.94 |
ROIC/WACC0.96
WACC14.05%
2.3 Liquidity
A Current Ratio of 1.26 indicates that 2PP should not have too much problems paying its short term obligations.
Looking at the Current ratio, with a value of 1.26, 2PP is in the better half of the industry, outperforming 64.00% of the companies in the same industry.
2PP has a Quick Ratio of 1.26. This is a normal value and indicates that 2PP is financially healthy and should not expect problems in meeting its short term obligations.
2PP has a better Quick ratio (1.26) than 66.00% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.26 | ||
| Quick Ratio | 1.26 |
3. Growth
3.1 Past
2PP shows a slight negative growth in Earnings Per Share. In the last year, the EPS has decreased by -2.54%.
The Earnings Per Share has been growing by 9.87% on average over the past years. This is quite good.
The Revenue has been growing slightly by 6.81% in the past year.
2PP shows quite a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 12.34% yearly.
EPS 1Y (TTM)-2.54%
EPS 3Y2.76%
EPS 5Y9.87%
EPS Q2Q%-19.59%
Revenue 1Y (TTM)6.81%
Revenue growth 3Y7.82%
Revenue growth 5Y12.34%
Sales Q2Q%4.24%
3.2 Future
Based on estimates for the next years, 2PP will show a quite strong growth in Earnings Per Share. The EPS will grow by 11.30% on average per year.
2PP is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 7.43% yearly.
EPS Next Y3.28%
EPS Next 2Y7.53%
EPS Next 3Y9.2%
EPS Next 5Y11.3%
Revenue Next Year4.26%
Revenue Next 2Y5.41%
Revenue Next 3Y6.01%
Revenue Next 5Y7.43%
3.3 Evolution
The EPS growth rate is stable: in the next years the growth will be about the same than in the last years.
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
Based on the Price/Earnings ratio of 13.70, the valuation of 2PP can be described as correct.
Based on the Price/Earnings ratio, 2PP is valued a bit cheaper than the industry average as 64.00% of the companies are valued more expensively.
2PP's Price/Earnings ratio indicates a rather cheap valuation when compared to the S&P500 average which is at 29.35.
With a Price/Forward Earnings ratio of 13.27, 2PP is valued correctly.
The rest of the industry has a similar Price/Forward Earnings ratio as 2PP.
2PP is valuated rather cheaply when we compare the Price/Forward Earnings ratio to 22.10, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 13.7 | ||
| Fwd PE | 13.27 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, 2PP is valued a bit cheaper than the industry average as 66.00% of the companies are valued more expensively.
Based on the Price/Free Cash Flow ratio, 2PP is valued a bit cheaper than 70.00% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 9.98 | ||
| EV/EBITDA | 9.35 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates 2PP does not grow enough to justify the current Price/Earnings ratio.
The decent profitability rating of 2PP may justify a higher PE ratio.
PEG (NY)4.18
PEG (5Y)1.39
EPS Next 2Y7.53%
EPS Next 3Y9.2%
5. Dividend
5.1 Amount
2PP does not give a dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
FRA:2PP (3/7/2025, 7:00:00 PM)
62.88
-1.02 (-1.6%)
Chartmill FA Rating
GICS SectorFinancials
GICS IndustryGroupFinancial Services
GICS IndustryFinancial Services
Earnings (Last)
Earnings (Next)
Inst Owners77.78%
Inst Owner ChangeN/A
Ins Owners0.09%
Ins Owner ChangeN/A
Market Cap62.20B
Analysts74.51
Price Target91.88 (46.12%)
Short Float %N/A
Short RatioN/A
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
Yearly DividendN/A
Dividend Growth(5Y)N/A
DPN/A
Div Incr Years0
Div Non Decr Years0
Ex-DateN/A
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)6.99%
Min EPS beat(2)3.97%
Max EPS beat(2)10.02%
EPS beat(4)4
Avg EPS beat(4)11.27%
Min EPS beat(4)3.97%
Max EPS beat(4)18.26%
EPS beat(8)7
Avg EPS beat(8)7.19%
EPS beat(12)10
Avg EPS beat(12)6.15%
EPS beat(16)13
Avg EPS beat(16)5.67%
Revenue beat(2)0
Avg Revenue beat(2)-1.56%
Min Revenue beat(2)-2.46%
Max Revenue beat(2)-0.65%
Revenue beat(4)1
Avg Revenue beat(4)-0.94%
Min Revenue beat(4)-2.46%
Max Revenue beat(4)0.47%
Revenue beat(8)1
Avg Revenue beat(8)-1.02%
Revenue beat(12)1
Avg Revenue beat(12)-1.17%
Revenue beat(16)2
Avg Revenue beat(16)-1.27%
PT rev (1m)-0.09%
PT rev (3m)4.71%
EPS NQ rev (1m)2.53%
EPS NQ rev (3m)3.33%
EPS NY rev (1m)3.13%
EPS NY rev (3m)3.09%
Revenue NQ rev (1m)-0.82%
Revenue NQ rev (3m)-2.34%
Revenue NY rev (1m)-0.54%
Revenue NY rev (3m)-1.36%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 13.7 | ||
| Fwd PE | 13.27 | ||
| P/S | 2.12 | ||
| P/FCF | 9.98 | ||
| P/OCF | 9.06 | ||
| P/B | 3.31 | ||
| P/tB | 7.3 | ||
| EV/EBITDA | 9.35 |
EPS(TTM)4.59
EY7.3%
EPS(NY)4.74
Fwd EY7.53%
FCF(TTM)6.3
FCFY10.02%
OCF(TTM)6.94
OCFY11.03%
SpS29.61
BVpS19.01
TBVpS8.62
PEG (NY)4.18
PEG (5Y)1.39
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 5.08% | ||
| ROE | 20.31% | ||
| ROCE | 17.34% | ||
| ROIC | 13.55% | ||
| ROICexc | 20.09% | ||
| ROICexgc | 40.03% | ||
| OM | 18.12% | ||
| PM (TTM) | 13.04% | ||
| GM | 40.54% | ||
| FCFM | 21.28% |
ROA(3y)4.44%
ROA(5y)4.96%
ROE(3y)17.47%
ROE(5y)18.52%
ROIC(3y)11.47%
ROIC(5y)10.62%
ROICexc(3y)17.88%
ROICexc(5y)16.45%
ROICexgc(3y)39.06%
ROICexgc(5y)35.94%
ROCE(3y)14.68%
ROCE(5y)13.59%
ROICexcg growth 3Y7.88%
ROICexcg growth 5Y4.11%
ROICexc growth 3Y11.61%
ROICexc growth 5Y4.7%
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%
F-Score6
Asset Turnover0.39
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.48 | ||
| Debt/FCF | 1.64 | ||
| Debt/EBITDA | 1.46 | ||
| Cap/Depr | 66.18% | ||
| Cap/Sales | 2.15% | ||
| Interest Coverage | 15.75 | ||
| Cash Conversion | 109.64% | ||
| Profit Quality | 163.18% | ||
| Current Ratio | 1.26 | ||
| Quick Ratio | 1.26 | ||
| Altman-Z | 1.94 |
F-Score6
WACC14.05%
ROIC/WACC0.96
Cap/Depr(3y)59.3%
Cap/Depr(5y)64.5%
Cap/Sales(3y)2.27%
Cap/Sales(5y)2.88%
Profit Quality(3y)157.9%
Profit Quality(5y)143.67%
High Growth Momentum
Growth
EPS 1Y (TTM)-2.54%
EPS 3Y2.76%
EPS 5Y9.87%
EPS Q2Q%-19.59%
EPS Next Y3.28%
EPS Next 2Y7.53%
EPS Next 3Y9.2%
EPS Next 5Y11.3%
Revenue 1Y (TTM)6.81%
Revenue growth 3Y7.82%
Revenue growth 5Y12.34%
Sales Q2Q%4.24%
Revenue Next Year4.26%
Revenue Next 2Y5.41%
Revenue Next 3Y6.01%
Revenue Next 5Y7.43%
EBIT growth 1Y16.57%
EBIT growth 3Y10.05%
EBIT growth 5Y15.61%
EBIT Next Year22.75%
EBIT Next 3Y9.33%
EBIT Next 5Y11.26%
FCF growth 1Y60.36%
FCF growth 3Y11.44%
FCF growth 5Y14.98%
OCF growth 1Y53.83%
OCF growth 3Y8.72%
OCF growth 5Y12.85%