PAYPAL HOLDINGS INC (PYPL) Stock Fundamental Analysis
USA - NASDAQ:PYPL - US70450Y1038 - Common Stock
61.89 USD
-0.92 (-1.46%)
61.93 USD
+0.04 (+0.06%)
We assign a fundamental rating of 6 out of 10 to PYPL. PYPL was compared to 99 industry peers in the Financial Services industry. While PYPL belongs to the best of the industry regarding profitability, 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
PYPL had positive earnings in the past year.
PYPL had a positive operating cash flow in the past year.
In the past 5 years PYPL has always been profitable.
In the past 5 years PYPL always reported a positive cash flow from operatings.
1.2 Ratios
Looking at the Return On Assets, with a value of 6.16%, PYPL is in the better half of the industry, outperforming 79.80% of the companies in the same industry.
PYPL's Return On Equity of 24.34% is amongst the best of the industry. PYPL outperforms 87.88% of its industry peers.
PYPL has a better Return On Invested Capital (14.11%) than 90.91% of its industry peers.
PYPL had an Average Return On Invested Capital over the past 3 years of 11.47%. This is above the industry average of 8.15%.
The 3 year average ROIC (11.47%) for PYPL is below the current ROIC(14.11%), indicating increased profibility in the last year.
| 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
With a decent Profit Margin value of 14.96%, PYPL is doing good in the industry, outperforming 62.63% of the companies in the same industry.
PYPL's Profit Margin has been stable in the last couple of years.
PYPL's Operating Margin of 19.16% is fine compared to the rest of the industry. PYPL outperforms 67.68% of its industry peers.
PYPL's Operating Margin has improved in the last couple of years.
PYPL has a better Gross Margin (41.56%) than 62.63% of its industry peers.
PYPL's Gross Margin has declined in the last couple of years.
| 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
PYPL has a Return on Invested Capital (ROIC), which is well above the Cost of Capital (WACC), which means it is creating value.
The number of shares outstanding for PYPL has been reduced compared to 1 year ago.
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 2.04. 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.
PYPL's Altman-Z score of 2.04 is fine compared to the rest of the industry. PYPL outperforms 76.77% of its industry peers.
PYPL has a debt to FCF ratio of 2.06. This is a good value and a sign of high solvency as PYPL would need 2.06 years to pay back of all of its debts.
The Debt to FCF ratio of PYPL (2.06) is better than 74.75% of its industry peers.
PYPL has a Debt/Equity ratio of 0.56. This is a neutral value indicating PYPL is somewhat dependend on debt financing.
Looking at the Debt to Equity ratio, with a value of 0.56, PYPL is in line with its industry, outperforming 56.57% of the companies in the same industry.
Even though the debt/equity ratio score it not favorable for PYPL, 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 | 2.04 |
ROIC/WACC1.81
WACC7.81%
2.3 Liquidity
A Current Ratio of 1.34 indicates that PYPL should not have too much problems paying its short term obligations.
PYPL has a better Current ratio (1.34) than 64.65% of its industry peers.
A Quick Ratio of 1.34 indicates that PYPL should not have too much problems paying its short term obligations.
The Quick ratio of PYPL (1.34) is better than 65.66% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.34 | ||
| Quick Ratio | 1.34 |
3. Growth
3.1 Past
The earnings per share for PYPL have decreased by -0.19% in the last year.
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 4.47% in the past year.
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)-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
The Earnings Per Share is expected to grow by 13.14% on average over the next years. This is quite good.
The Revenue is expected to grow by 6.28% on average over the next years.
EPS Next Y9.42%
EPS Next 2Y9.27%
EPS Next 3Y10.66%
EPS Next 5Y13.14%
Revenue Next Year5.07%
Revenue Next 2Y5.54%
Revenue Next 3Y5.96%
Revenue Next 5Y6.28%
3.3 Evolution
The EPS growth rate is accelerating: in the next years the growth will be better 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
Based on the Price/Earnings ratio of 11.77, the valuation of PYPL can be described as reasonable.
PYPL's Price/Earnings ratio is in line with the industry average.
PYPL's Price/Earnings ratio indicates a rather cheap valuation when compared to the S&P500 average which is at 25.56.
PYPL is valuated reasonably with a Price/Forward Earnings ratio of 10.41.
The rest of the industry has a similar Price/Forward Earnings ratio as PYPL.
The average S&P500 Price/Forward Earnings ratio is at 34.62. PYPL is valued rather cheaply when compared to this.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 11.77 | ||
| Fwd PE | 10.41 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, PYPL is valued a bit cheaper than 74.75% 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 69.70% of the companies are valued more expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 10.63 | ||
| EV/EBITDA | 7.98 |
4.3 Compensation for Growth
The PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
The excellent profitability rating of PYPL may justify a higher PE ratio.
PEG (NY)1.25
PEG (5Y)1.19
EPS Next 2Y9.27%
EPS Next 3Y10.66%
5. Dividend
5.1 Amount
PYPL has a yearly dividend return of 0.86%, which is pretty low.
Compared to an average industry Dividend Yield of 4.67, PYPL has a dividend in line with its industry peers.
With a Dividend Yield of 0.86, PYPL pays less dividend than the S&P500 average, which is at 2.44.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.86% |
5.2 History
PYPL is new to the dividend game and has less than 3 years of track record.
Dividend Growth(5Y)N/A
Div Incr Years0
Div Non Decr Years0
5.3 Sustainability
DPN/A
EPS Next 2Y9.27%
EPS Next 3Y10.66%
61.89
-0.92 (-1.46%)
Chartmill FA Rating
GICS SectorFinancials
GICS IndustryGroupFinancial Services
GICS IndustryFinancial Services
Earnings (Last)
Earnings (Next)
Inst Owners80.2%
Inst Owner Change-1.7%
Ins Owners0.1%
Ins Owner Change4.63%
Market Cap59.13B
Revenue(TTM)32.86B
Net Income(TTM)4.92B
Analysts70.98
Price Target84.08 (35.85%)
Short Float %4.65%
Short Ratio2.7
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.86% |
Yearly DividendN/A
Dividend Growth(5Y)N/A
DPN/A
Div Incr Years0
Div Non Decr Years0
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)7.61%
Min EPS beat(2)5.83%
Max EPS beat(2)9.38%
EPS beat(4)4
Avg EPS beat(4)7.86%
Min EPS beat(4)3.97%
Max EPS beat(4)12.26%
EPS beat(8)8
Avg EPS beat(8)9.88%
EPS beat(12)11
Avg EPS beat(12)7.2%
EPS beat(16)13
Avg EPS beat(16)6.14%
Revenue beat(2)2
Avg Revenue beat(2)0.4%
Min Revenue beat(2)0.26%
Max Revenue beat(2)0.55%
Revenue beat(4)2
Avg Revenue beat(4)-0.63%
Min Revenue beat(4)-2.67%
Max Revenue beat(4)0.55%
Revenue beat(8)3
Avg Revenue beat(8)-0.71%
Revenue beat(12)3
Avg Revenue beat(12)-1.01%
Revenue beat(16)3
Avg Revenue beat(16)-1.07%
PT rev (1m)-1.28%
PT rev (3m)-0.32%
EPS NQ rev (1m)-1.17%
EPS NQ rev (3m)-0.9%
EPS NY rev (1m)1.69%
EPS NY rev (3m)4.92%
Revenue NQ rev (1m)0.82%
Revenue NQ rev (3m)0.95%
Revenue NY rev (1m)0.68%
Revenue NY rev (3m)1.9%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 11.77 | ||
| Fwd PE | 10.41 | ||
| P/S | 1.8 | ||
| P/FCF | 10.63 | ||
| P/OCF | 9.2 | ||
| P/B | 2.93 | ||
| P/tB | 6.55 | ||
| EV/EBITDA | 7.98 |
EPS(TTM)5.26
EY8.5%
EPS(NY)5.95
Fwd EY9.61%
FCF(TTM)5.82
FCFY9.41%
OCF(TTM)6.73
OCFY10.87%
SpS34.4
BVpS21.14
TBVpS9.45
PEG (NY)1.25
PEG (5Y)1.19
Graham Number50.02
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 6.16% | ||
| ROE | 24.34% | ||
| ROCE | 18.05% | ||
| ROIC | 14.11% | ||
| ROICexc | 20.4% | ||
| ROICexgc | 37.98% | ||
| OM | 19.16% | ||
| PM (TTM) | 14.96% | ||
| GM | 41.56% | ||
| FCFM | 16.93% |
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%
ROICexgc growth 3Y7.88%
ROICexgc 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 Turnover0.41
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.56 | ||
| Debt/FCF | 2.06 | ||
| Debt/EBITDA | 1.55 | ||
| Cap/Depr | 88.04% | ||
| Cap/Sales | 2.62% | ||
| Interest Coverage | 15.43 | ||
| Cash Conversion | 88.34% | ||
| Profit Quality | 113.18% | ||
| Current Ratio | 1.34 | ||
| Quick Ratio | 1.34 | ||
| Altman-Z | 2.04 |
F-Score8
WACC7.81%
ROIC/WACC1.81
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)-0.19%
EPS 3Y2.76%
EPS 5Y9.87%
EPS Q2Q%11.67%
EPS Next Y9.42%
EPS Next 2Y9.27%
EPS Next 3Y10.66%
EPS Next 5Y13.14%
Revenue 1Y (TTM)4.47%
Revenue growth 3Y7.82%
Revenue growth 5Y12.34%
Sales Q2Q%7.26%
Revenue Next Year5.07%
Revenue Next 2Y5.54%
Revenue Next 3Y5.96%
Revenue Next 5Y6.28%
EBIT growth 1Y10.67%
EBIT growth 3Y10.05%
EBIT growth 5Y15.61%
EBIT Next Year23.15%
EBIT Next 3Y12.17%
EBIT Next 5Y10.48%
FCF growth 1Y74.78%
FCF growth 3Y11.44%
FCF growth 5Y14.98%
OCF growth 1Y68.22%
OCF growth 3Y8.72%
OCF growth 5Y12.85%
PAYPAL HOLDINGS INC / PYPL FAQ
Can you provide the ChartMill fundamental rating for PAYPAL HOLDINGS INC?
ChartMill assigns a fundamental rating of 6 / 10 to PYPL.
Can you provide the valuation status for PAYPAL HOLDINGS INC?
ChartMill assigns a valuation rating of 6 / 10 to PAYPAL HOLDINGS INC (PYPL). This can be considered as Fairly Valued.
What is the profitability of PYPL stock?
PAYPAL HOLDINGS INC (PYPL) has a profitability rating of 8 / 10.
What are the PE and PB ratios of PAYPAL HOLDINGS INC (PYPL) stock?
The Price/Earnings (PE) ratio for PAYPAL HOLDINGS INC (PYPL) is 11.77 and the Price/Book (PB) ratio is 2.93.
What is the earnings growth outlook for PAYPAL HOLDINGS INC?
The Earnings per Share (EPS) of PAYPAL HOLDINGS INC (PYPL) is expected to grow by 9.42% in the next year.