PAYPAL HOLDINGS INC (PYPL) Stock Fundamental Analysis
USA - NASDAQ:PYPL - US70450Y1038 - Common Stock
70.05 USD
+0.85 (+1.23%)
69.98 USD
-0.07 (-0.1%)
Overall PYPL gets a fundamental rating of 6 out of 10. We evaluated PYPL against 99 industry peers in the Financial Services industry. PYPL has an excellent profitability rating, but there are some minor concerns on its financial health. PYPL is not valued too expensively and it also shows a decent growth rate.
1. Profitability
1.1 Basic Checks
In the past year PYPL was profitable.
In the past year PYPL had a positive cash flow from operations.
In the past 5 years PYPL has always been profitable.
Each year in the past 5 years PYPL had a positive operating cash flow.
1.2 Ratios
PYPL's Return On Assets of 5.87% is fine compared to the rest of the industry. PYPL outperforms 78.79% of its industry peers.
PYPL's Return On Equity of 23.16% is amongst the best of the industry. PYPL outperforms 86.87% of its industry peers.
The Return On Invested Capital of PYPL (13.86%) is better than 89.90% 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 7.79%.
The 3 year average ROIC (11.47%) for PYPL is below the current ROIC(13.86%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 5.87% | ||
| ROE | 23.16% | ||
| ROIC | 13.86% |
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 has a Profit Margin of 14.49%. This is in the better half of the industry: PYPL outperforms 63.64% of its industry peers.
In the last couple of years the Profit Margin of PYPL has remained more or less at the same level.
PYPL's Operating Margin of 19.08% 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.
Looking at the Gross Margin, with a value of 41.68%, PYPL is in the better half of the industry, outperforming 60.61% of the companies in the same industry.
In the last couple of years the Gross Margin of PYPL has declined.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 19.08% | ||
| PM (TTM) | 14.49% | ||
| GM | 41.68% |
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 just above the Cost of Capital (WACC), so PYPL is still creating some value.
The number of shares outstanding for PYPL has been reduced compared to 1 year ago.
PYPL has less shares outstanding than it did 5 years ago.
PYPL has a worse debt/assets ratio than last year.
2.2 Solvency
An Altman-Z score of 2.08 indicates that PYPL is not a great score, but indicates only limited risk for bankruptcy at the moment.
Looking at the Altman-Z score, with a value of 2.08, PYPL is in the better half of the industry, outperforming 78.79% of the companies in the same industry.
The Debt to FCF ratio of PYPL is 2.13, which is a good value as it means it would take PYPL, 2.13 years of fcf income to pay off all of its debts.
With a decent Debt to FCF ratio value of 2.13, PYPL is doing good in the industry, outperforming 74.75% of the companies in the same industry.
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 | 2.13 | ||
| Altman-Z | 2.08 |
ROIC/WACC1.78
WACC7.79%
2.3 Liquidity
PYPL has a Current Ratio of 1.33. This is a normal value and indicates that PYPL is financially healthy and should not expect problems in meeting its short term obligations.
Looking at the Current ratio, with a value of 1.33, PYPL is in the better half of the industry, outperforming 60.61% of the companies in the same industry.
A Quick Ratio of 1.33 indicates that PYPL should not have too much problems paying its short term obligations.
PYPL's Quick ratio of 1.33 is fine compared to the rest of the industry. PYPL outperforms 62.63% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.33 | ||
| Quick Ratio | 1.33 |
3. Growth
3.1 Past
PYPL shows a slight negative growth in Earnings Per Share. In the last year, the EPS has decreased by -4.66%.
The Earnings Per Share has been growing by 9.87% on average over the past years. This is quite good.
Looking at the last year, PYPL shows a small growth in Revenue. The Revenue has grown by 4.07% in the last 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)-4.66%
EPS 3Y2.76%
EPS 5Y9.87%
EPS Q2Q%17.65%
Revenue 1Y (TTM)4.07%
Revenue growth 3Y7.82%
Revenue growth 5Y12.34%
Sales Q2Q%5.11%
3.2 Future
The Earnings Per Share is expected to grow by 11.09% on average over the next years. This is quite good.
Based on estimates for the next years, PYPL will show a small growth in Revenue. The Revenue will grow by 5.57% on average per year.
EPS Next Y7.6%
EPS Next 2Y9.1%
EPS Next 3Y10.5%
EPS Next 5Y11.09%
Revenue Next Year4.36%
Revenue Next 2Y5.15%
Revenue Next 3Y5.72%
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 13.68 indicates a correct valuation of PYPL.
PYPL's Price/Earnings ratio is in line with the industry average.
PYPL is valuated cheaply when we compare the Price/Earnings ratio to 27.77, which is the current average of the S&P500 Index.
A Price/Forward Earnings ratio of 11.82 indicates a reasonable valuation of PYPL.
PYPL's Price/Forward Earnings ratio is in line with the industry average.
PYPL's Price/Forward Earnings ratio indicates a valuation a bit cheaper than the S&P500 average which is at 23.23.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 13.68 | ||
| Fwd PE | 11.82 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, PYPL is valued a bit cheaper than 75.76% of the companies in the same industry.
Based on the Price/Free Cash Flow ratio, PYPL is valued a bit cheaper than 70.71% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 12.65 | ||
| EV/EBITDA | 9.08 |
4.3 Compensation for Growth
The PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
PYPL has an outstanding profitability rating, which may justify a higher PE ratio.
PEG (NY)1.8
PEG (5Y)1.39
EPS Next 2Y9.1%
EPS Next 3Y10.5%
5. Dividend
5.1 Amount
PYPL does not give a dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
70.05
+0.85 (+1.23%)
Chartmill FA Rating
GICS SectorFinancials
GICS IndustryGroupFinancial Services
GICS IndustryFinancial Services
Earnings (Last)
Earnings (Next)
Inst Owners80.2%
Inst Owner Change-0.23%
Ins Owners0.1%
Ins Owner Change0.2%
Market Cap66.92B
Analysts72.65
Price Target85.18 (21.6%)
Short Float %3.13%
Short Ratio2.53
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)9.05%
Min EPS beat(2)5.83%
Max EPS beat(2)12.26%
EPS beat(4)4
Avg EPS beat(4)8.02%
Min EPS beat(4)3.97%
Max EPS beat(4)12.26%
EPS beat(8)8
Avg EPS beat(8)9.18%
EPS beat(12)11
Avg EPS beat(12)7.29%
EPS beat(16)13
Avg EPS beat(16)5.65%
Revenue beat(2)1
Avg Revenue beat(2)-1.06%
Min Revenue beat(2)-2.67%
Max Revenue beat(2)0.55%
Revenue beat(4)1
Avg Revenue beat(4)-1.31%
Min Revenue beat(4)-2.67%
Max Revenue beat(4)0.55%
Revenue beat(8)2
Avg Revenue beat(8)-0.93%
Revenue beat(12)2
Avg Revenue beat(12)-1.16%
Revenue beat(16)2
Avg Revenue beat(16)-1.26%
PT rev (1m)1.39%
PT rev (3m)2.32%
EPS NQ rev (1m)-0.38%
EPS NQ rev (3m)0.21%
EPS NY rev (1m)0.16%
EPS NY rev (3m)3.18%
Revenue NQ rev (1m)0.01%
Revenue NQ rev (3m)1.12%
Revenue NY rev (1m)-0.07%
Revenue NY rev (3m)1.26%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 13.68 | ||
| Fwd PE | 11.82 | ||
| P/S | 2.07 | ||
| P/FCF | 12.65 | ||
| P/OCF | 11.03 | ||
| P/B | 3.31 | ||
| P/tB | 7.47 | ||
| EV/EBITDA | 9.08 |
EPS(TTM)5.12
EY7.31%
EPS(NY)5.93
Fwd EY8.46%
FCF(TTM)5.54
FCFY7.91%
OCF(TTM)6.35
OCFY9.06%
SpS33.8
BVpS21.14
TBVpS9.37
PEG (NY)1.8
PEG (5Y)1.39
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 5.87% | ||
| ROE | 23.16% | ||
| ROCE | 17.74% | ||
| ROIC | 13.86% | ||
| ROICexc | 19.48% | ||
| ROICexgc | 35.74% | ||
| OM | 19.08% | ||
| PM (TTM) | 14.49% | ||
| GM | 41.68% | ||
| FCFM | 16.39% |
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 Turnover0.4
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.56 | ||
| Debt/FCF | 2.13 | ||
| Debt/EBITDA | 1.58 | ||
| Cap/Depr | 78.34% | ||
| Cap/Sales | 2.4% | ||
| Interest Coverage | 15.76 | ||
| Cash Conversion | 84.85% | ||
| Profit Quality | 113.1% | ||
| Current Ratio | 1.33 | ||
| Quick Ratio | 1.33 | ||
| Altman-Z | 2.08 |
F-Score8
WACC7.79%
ROIC/WACC1.78
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)-4.66%
EPS 3Y2.76%
EPS 5Y9.87%
EPS Q2Q%17.65%
EPS Next Y7.6%
EPS Next 2Y9.1%
EPS Next 3Y10.5%
EPS Next 5Y11.09%
Revenue 1Y (TTM)4.07%
Revenue growth 3Y7.82%
Revenue growth 5Y12.34%
Sales Q2Q%5.11%
Revenue Next Year4.36%
Revenue Next 2Y5.15%
Revenue Next 3Y5.72%
Revenue Next 5Y5.57%
EBIT growth 1Y13.21%
EBIT growth 3Y10.05%
EBIT growth 5Y15.61%
EBIT Next Year23.15%
EBIT Next 3Y12.17%
EBIT Next 5Y10.05%
FCF growth 1Y44.75%
FCF growth 3Y11.44%
FCF growth 5Y14.98%
OCF growth 1Y40.55%
OCF growth 3Y8.72%
OCF growth 5Y12.85%