PAYPAL HOLDINGS INC (PYPL) Stock Fundamental Analysis
NASDAQ:PYPL - Nasdaq - US70450Y1038 - Common Stock - Currency: USD
Taking everything into account, PYPL scores 5 out of 10 in our fundamental rating. PYPL was compared to 100 industry peers in the Financial Services industry. PYPL scores excellent on profitability, but there are some minor concerns on its financial health. PYPL has a decent growth rate and is not valued too expensively.
1. Profitability
1.1 Basic Checks
In the past year PYPL was profitable.
PYPL had a positive operating cash flow in the past year.
In the past 5 years PYPL has always been profitable.
PYPL had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
PYPL's Return On Assets of 5.59% is fine compared to the rest of the industry. PYPL outperforms 78.00% of its industry peers.
PYPL has a Return On Equity of 22.44%. This is amongst the best in the industry. PYPL outperforms 85.00% of its industry peers.
Looking at the Return On Invested Capital, with a value of 13.48%, PYPL belongs to the top of the industry, outperforming 88.00% of the companies in the same industry.
The Average Return On Invested Capital over the past 3 years for PYPL is in line with the industry average of 11.84%.
The 3 year average ROIC (11.47%) for PYPL is below the current ROIC(13.48%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 5.59% | ||
| ROE | 22.44% | ||
| ROIC | 13.48% |
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
PYPL's Profit Margin of 14.26% is fine compared to the rest of the industry. PYPL outperforms 62.00% of its industry peers.
PYPL's Profit Margin has been stable in the last couple of years.
PYPL's Operating Margin of 18.75% is fine compared to the rest of the industry. PYPL outperforms 65.00% of its industry peers.
PYPL's Operating Margin has improved in the last couple of years.
PYPL has a Gross Margin of 41.40%. This is in the better half of the industry: PYPL outperforms 61.00% of its industry peers.
In the last couple of years the Gross Margin of PYPL has declined.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 18.75% | ||
| PM (TTM) | 14.26% | ||
| GM | 41.4% |
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
With a Return on Invested Capital (ROIC) just above the Cost of Capital (WACC), PYPL is creating some value.
Compared to 1 year ago, PYPL has less shares outstanding
The number of shares outstanding for PYPL has been reduced compared to 5 years ago.
Compared to 1 year ago, PYPL has a worse debt to assets ratio.
2.2 Solvency
PYPL has an Altman-Z score of 2.02. This is not the best score and indicates that PYPL is in the grey zone with still only limited risk for bankruptcy at the moment.
With a decent Altman-Z score value of 2.02, PYPL is doing good in the industry, outperforming 73.00% of the companies in the same industry.
The Debt to FCF ratio of PYPL is 2.12, which is a good value as it means it would take PYPL, 2.12 years of fcf income to pay off all of its debts.
With a decent Debt to FCF ratio value of 2.12, PYPL is doing good in the industry, outperforming 77.00% of the companies in the same industry.
A Debt/Equity ratio of 0.56 indicates that PYPL is somewhat dependend on debt financing.
PYPL's Debt to Equity ratio of 0.56 is in line compared to the rest of the industry. PYPL outperforms 57.00% of its industry peers.
Although PYPL does not score too well on debt/equity it has very limited outstanding debt, which is well covered by the FCF. We will not put too much weight on the debt/equity number as it may be because of low equity, which could be a consequence of a share buyback program for instance. This needs to be investigated.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.56 | ||
| Debt/FCF | 2.12 | ||
| Altman-Z | 2.02 |
ROIC/WACC1.65
WACC8.18%
2.3 Liquidity
PYPL has a Current Ratio of 1.30. This is a normal value and indicates that PYPL is financially healthy and should not expect problems in meeting its short term obligations.
PYPL has a Current ratio (1.30) which is comparable to the rest of the industry.
A Quick Ratio of 1.30 indicates that PYPL should not have too much problems paying its short term obligations.
PYPL has a better Quick ratio (1.30) than 62.00% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.3 | ||
| Quick Ratio | 1.3 |
3. Growth
3.1 Past
The earnings per share for PYPL have decreased by -8.05% in the last year.
PYPL shows quite a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 9.87% yearly.
PYPL shows a small growth in Revenue. In the last year, the Revenue has grown by 4.79%.
Measured over the past years, PYPL shows a quite strong growth in Revenue. The Revenue has been growing by 12.34% on average per year.
EPS 1Y (TTM)-8.05%
EPS 3Y2.76%
EPS 5Y9.87%
EPS Q2Q%-5%
Revenue 1Y (TTM)4.79%
Revenue growth 3Y7.82%
Revenue growth 5Y12.34%
Sales Q2Q%1.19%
3.2 Future
PYPL is expected to show quite a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 11.09% yearly.
PYPL is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 5.57% yearly.
EPS Next Y4.29%
EPS Next 2Y7.57%
EPS Next 3Y9.24%
EPS Next 5Y11.09%
Revenue Next Year3.06%
Revenue Next 2Y4.37%
Revenue Next 3Y5.25%
Revenue Next 5Y5.57%
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.
The Revenue growth rate is decreasing: in the next years the growth will be less than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
A Price/Earnings ratio of 15.02 indicates a correct valuation of PYPL.
Compared to the rest of the industry, the Price/Earnings ratio of PYPL is on the same level as its industry peers.
Compared to an average S&P500 Price/Earnings ratio of 27.41, PYPL is valued a bit cheaper.
A Price/Forward Earnings ratio of 12.80 indicates a correct valuation of PYPL.
PYPL's Price/Forward Earnings ratio is in line with the industry average.
Compared to an average S&P500 Price/Forward Earnings ratio of 35.19, PYPL is valued rather cheaply.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 15.02 | ||
| Fwd PE | 12.8 |
4.2 Price Multiples
67.00% of the companies in the same industry are more expensive than PYPL, based on the Enterprise Value to EBITDA ratio.
PYPL's Price/Free Cash Flow ratio is a bit cheaper when compared to the industry. PYPL is cheaper than 71.00% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 12.01 | ||
| EV/EBITDA | 9.59 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
PYPL has a very decent profitability rating, which may justify a higher PE ratio.
PEG (NY)3.5
PEG (5Y)1.52
EPS Next 2Y7.57%
EPS Next 3Y9.24%
5. Dividend
5.1 Amount
PYPL does not give a dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
NASDAQ:PYPL (7/14/2025, 3:22:07 PM)
73.73
+2.37 (+3.32%)
Chartmill FA Rating
GICS SectorFinancials
GICS IndustryGroupFinancial Services
GICS IndustryFinancial Services
Earnings (Last)
Earnings (Next)
Inst Owners79.32%
Inst Owner Change0.03%
Ins Owners0.09%
Ins Owner Change0.28%
Market Cap71.70B
Analysts72.69
Price Target83.25 (12.91%)
Short Float %2.84%
Short Ratio2.86
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)8.11%
Min EPS beat(2)3.97%
Max EPS beat(2)12.26%
EPS beat(4)4
Avg EPS beat(4)11.13%
Min EPS beat(4)3.97%
Max EPS beat(4)18.26%
EPS beat(8)7
Avg EPS beat(8)8.17%
EPS beat(12)11
Avg EPS beat(12)7.31%
EPS beat(16)13
Avg EPS beat(16)5.31%
Revenue beat(2)0
Avg Revenue beat(2)-1.66%
Min Revenue beat(2)-2.67%
Max Revenue beat(2)-0.65%
Revenue beat(4)0
Avg Revenue beat(4)-1.73%
Min Revenue beat(4)-2.67%
Max Revenue beat(4)-0.65%
Revenue beat(8)1
Avg Revenue beat(8)-1.22%
Revenue beat(12)1
Avg Revenue beat(12)-1.34%
Revenue beat(16)1
Avg Revenue beat(16)-1.45%
PT rev (1m)-0.07%
PT rev (3m)-12.19%
EPS NQ rev (1m)-0.05%
EPS NQ rev (3m)6.48%
EPS NY rev (1m)-0.04%
EPS NY rev (3m)1.08%
Revenue NQ rev (1m)-0.05%
Revenue NQ rev (3m)-0.19%
Revenue NY rev (1m)-0.14%
Revenue NY rev (3m)-0.93%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 15.02 | ||
| Fwd PE | 12.8 | ||
| P/S | 2.25 | ||
| P/FCF | 12.01 | ||
| P/OCF | 10.71 | ||
| P/B | 3.54 | ||
| P/tB | 7.92 | ||
| EV/EBITDA | 9.59 |
EPS(TTM)4.91
EY6.66%
EPS(NY)5.76
Fwd EY7.82%
FCF(TTM)6.14
FCFY8.32%
OCF(TTM)6.88
OCFY9.33%
SpS32.79
BVpS20.83
TBVpS9.3
PEG (NY)3.5
PEG (5Y)1.52
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 5.59% | ||
| ROE | 22.44% | ||
| ROCE | 17.25% | ||
| ROIC | 13.48% | ||
| ROICexc | 19.93% | ||
| ROICexgc | 38.19% | ||
| OM | 18.75% | ||
| PM (TTM) | 14.26% | ||
| GM | 41.4% | ||
| FCFM | 18.71% |
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-Score8
Asset Turnover0.39
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.56 | ||
| Debt/FCF | 2.12 | ||
| Debt/EBITDA | 1.64 | ||
| Cap/Depr | 71.64% | ||
| Cap/Sales | 2.27% | ||
| Interest Coverage | 16.34 | ||
| Cash Conversion | 95.74% | ||
| Profit Quality | 131.28% | ||
| Current Ratio | 1.3 | ||
| Quick Ratio | 1.3 | ||
| Altman-Z | 2.02 |
F-Score8
WACC8.18%
ROIC/WACC1.65
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)-8.05%
EPS 3Y2.76%
EPS 5Y9.87%
EPS Q2Q%-5%
EPS Next Y4.29%
EPS Next 2Y7.57%
EPS Next 3Y9.24%
EPS Next 5Y11.09%
Revenue 1Y (TTM)4.79%
Revenue growth 3Y7.82%
Revenue growth 5Y12.34%
Sales Q2Q%1.19%
Revenue Next Year3.06%
Revenue Next 2Y4.37%
Revenue Next 3Y5.25%
Revenue Next 5Y5.57%
EBIT growth 1Y15.85%
EBIT growth 3Y10.05%
EBIT growth 5Y15.61%
EBIT Next Year23.59%
EBIT Next 3Y12.87%
EBIT Next 5Y10.05%
FCF growth 1Y17.46%
FCF growth 3Y11.44%
FCF growth 5Y14.98%
OCF growth 1Y16.08%
OCF growth 3Y8.72%
OCF growth 5Y12.85%