PAYPAL HOLDINGS INC (PYPL) Stock Fundamental Analysis
USA - NASDAQ:PYPL - US70450Y1038 - Common Stock
66.22 USD
-0.04 (-0.06%)
66.43 USD
+0.21 (+0.32%)
PYPL gets a fundamental rating of 6 out of 10. The analysis compared the fundamentals against 98 industry peers in the Financial Services industry. PYPL scores excellent on profitability, 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.
Each year in the past 5 years PYPL has been profitable.
Each year in the past 5 years PYPL had a positive operating cash flow.
1.2 Ratios
PYPL has a better Return On Assets (6.16%) than 81.63% of its industry peers.
The Return On Equity of PYPL (24.34%) is better than 86.73% of its industry peers.
Looking at the Return On Invested Capital, with a value of 14.11%, PYPL belongs to the top of the industry, outperforming 90.82% of the companies in the same industry.
PYPL had an Average Return On Invested Capital over the past 3 years of 11.47%. This is above the industry average of 7.85%.
The last Return On Invested Capital (14.11%) for PYPL 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
PYPL's Profit Margin of 14.96% is fine compared to the rest of the industry. PYPL outperforms 64.29% of its industry peers.
PYPL's Profit Margin has been stable in the last couple of years.
The Operating Margin of PYPL (19.16%) is better than 67.35% of its industry peers.
In the last couple of years the Operating Margin of PYPL has grown nicely.
With a decent Gross Margin value of 41.56%, PYPL is doing good in the industry, outperforming 62.24% of the companies in the same industry.
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 just above the Cost of Capital (WACC), which means it is creating some value.
Compared to 1 year ago, PYPL has less shares outstanding
PYPL has less shares outstanding than it did 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 2.09. 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 2.09 is fine compared to the rest of the industry. PYPL outperforms 77.55% of its industry peers.
The Debt to FCF ratio of PYPL is 2.06, which is a good value as it means it would take PYPL, 2.06 years of fcf income to pay off all of its debts.
PYPL has a better Debt to FCF ratio (2.06) than 74.49% of its industry peers.
A Debt/Equity ratio of 0.56 indicates that PYPL is somewhat dependend on debt financing.
PYPL has a Debt to Equity ratio (0.56) which is in line with 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 | 2.06 | ||
| Altman-Z | 2.09 |
ROIC/WACC1.8
WACC7.84%
2.3 Liquidity
PYPL has a Current Ratio of 1.34. 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 of 1.34. This is in the better half of the industry: PYPL outperforms 63.27% 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 65.31% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.34 | ||
| Quick Ratio | 1.34 |
3. Growth
3.1 Past
PYPL shows a slight negative growth in Earnings Per Share. In the last year, the EPS has decreased by -0.19%.
Measured over the past years, PYPL shows a quite strong growth in Earnings Per Share. The EPS has been growing by 9.87% on average per year.
PYPL shows a small growth in Revenue. In the last year, the Revenue has grown by 4.47%.
The Revenue has been growing by 12.34% on average over the past years. This is quite good.
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, PYPL will show a quite strong growth in Earnings Per Share. The EPS will grow by 13.14% on average per year.
Based on estimates for the next years, PYPL will show a small growth in Revenue. The Revenue will grow by 6.28% on average per year.
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
PYPL is valuated correctly with a Price/Earnings ratio of 12.59.
The rest of the industry has a similar Price/Earnings ratio as PYPL.
PYPL's Price/Earnings ratio indicates a rather cheap valuation when compared to the S&P500 average which is at 25.83.
The Price/Forward Earnings ratio is 11.14, which indicates a very decent valuation of PYPL.
The rest of the industry has a similar Price/Forward Earnings ratio as PYPL.
PYPL's Price/Forward Earnings ratio indicates a rather cheap valuation when compared to the S&P500 average which is at 32.68.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 12.59 | ||
| Fwd PE | 11.14 |
4.2 Price Multiples
PYPL's Enterprise Value to EBITDA ratio is a bit cheaper when compared to the industry. PYPL is cheaper than 74.49% of the companies in the same industry.
PYPL's Price/Free Cash Flow ratio is a bit cheaper when compared to the industry. PYPL is cheaper than 67.35% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 11.37 | ||
| EV/EBITDA | 8.56 |
4.3 Compensation for Growth
PYPL's 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)1.34
PEG (5Y)1.28
EPS Next 2Y9.27%
EPS Next 3Y10.66%
5. Dividend
5.1 Amount
With a yearly dividend of 0.85%, PYPL is not a good candidate for dividend investing.
PYPL's Dividend Yield is comparable with the industry average which is at 4.94.
With a Dividend Yield of 0.85, PYPL pays less dividend than the S&P500 average, which is at 2.39.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.85% |
5.2 History
PYPL does not have a reliable dividend history as it only pays dividend since a couple or years.
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%
66.22
-0.04 (-0.06%)
Chartmill FA Rating
GICS SectorFinancials
GICS IndustryGroupFinancial Services
GICS IndustryFinancial Services
Earnings (Last)
Earnings (Next)
Inst Owners80.2%
Inst Owner Change-1%
Ins Owners0.1%
Ins Owner Change0.18%
Market Cap63.27B
Revenue(TTM)32.86B
Net Income(TTM)4.92B
Analysts70.98
Price Target84.08 (26.97%)
Short Float %4.05%
Short Ratio3.09
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.85% |
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)0.09%
PT rev (3m)0.95%
EPS NQ rev (1m)0.46%
EPS NQ rev (3m)3.21%
EPS NY rev (1m)-0.13%
EPS NY rev (3m)3.05%
Revenue NQ rev (1m)-0.04%
Revenue NQ rev (3m)1.31%
Revenue NY rev (1m)0.06%
Revenue NY rev (3m)1.32%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 12.59 | ||
| Fwd PE | 11.14 | ||
| P/S | 1.93 | ||
| P/FCF | 11.37 | ||
| P/OCF | 9.85 | ||
| P/B | 3.13 | ||
| P/tB | 7.01 | ||
| EV/EBITDA | 8.56 |
EPS(TTM)5.26
EY7.94%
EPS(NY)5.95
Fwd EY8.98%
FCF(TTM)5.82
FCFY8.8%
OCF(TTM)6.73
OCFY10.16%
SpS34.4
BVpS21.14
TBVpS9.45
PEG (NY)1.34
PEG (5Y)1.28
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 | 2.09 |
F-Score8
WACC7.84%
ROIC/WACC1.8
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 12.59 and the Price/Book (PB) ratio is 3.13.
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.