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PAYPAL HOLDINGS INC (PYPL) Stock Fundamental Analysis

NASDAQ:PYPL - Nasdaq - US70450Y1038 - Common Stock

91.81  +2.89 (+3.25%)

After market: 91.83 +0.02 (+0.02%)

Fundamental Rating

5

PYPL gets a fundamental rating of 5 out of 10. The analysis compared the fundamentals against 101 industry peers in the Financial Services industry. PYPL gets an excellent profitability rating and is at the same time showing great financial health properties. PYPL has a decent growth rate and is not valued too expensively.


Dividend Valuation Growth Profitability Health

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7

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.
PYPL Yearly Net Income VS EBIT VS OCF VS FCFPYPL Yearly Net Income VS EBIT VS OCF VS FCFYearly Net Income VS EBIT VS OCF VS FCF 2015 2016 2017 2018 2019 2020 2021 2022 2023 2B 4B 6B

1.2 Ratios

Looking at the Return On Assets, with a value of 5.30%, PYPL is in the better half of the industry, outperforming 79.21% of the companies in the same industry.
PYPL's Return On Equity of 21.95% is amongst the best of the industry. PYPL outperforms 86.14% of its industry peers.
PYPL has a better Return On Invested Capital (12.86%) than 90.10% of its industry peers.
The Average Return On Invested Capital over the past 3 years for PYPL is above the industry average of 7.84%.
The 3 year average ROIC (10.00%) for PYPL is below the current ROIC(12.86%), indicating increased profibility in the last year.
Industry RankSector Rank
ROA 5.3%
ROE 21.95%
ROIC 12.86%
ROA(3y)4.58%
ROA(5y)4.9%
ROE(3y)17.1%
ROE(5y)17.37%
ROIC(3y)10%
ROIC(5y)9.33%
PYPL Yearly ROA, ROE, ROICPYPL Yearly ROA, ROE, ROICYearly ROA, ROE, ROIC 2015 2016 2017 2018 2019 2020 2021 2022 2023 5 10 15 20

1.3 Margins

The Profit Margin of PYPL (14.08%) is better than 60.40% 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 18.09% is fine compared to the rest of the industry. PYPL outperforms 63.37% of its industry peers.
In the last couple of years the Operating Margin of PYPL has remained more or less at the same level.
Looking at the Gross Margin, with a value of 40.10%, PYPL is in the better half of the industry, outperforming 62.38% of the companies in the same industry.
In the last couple of years the Gross Margin of PYPL has declined.
Industry RankSector Rank
OM 18.09%
PM (TTM) 14.08%
GM 40.1%
OM growth 3Y1.29%
OM growth 5Y0.5%
PM growth 3Y-10.03%
PM growth 5Y1.39%
GM growth 3Y-5.3%
GM growth 5Y-2.98%
PYPL Yearly Profit, Operating, Gross MarginsPYPL Yearly Profit, Operating, Gross MarginsYearly Profit, Operating, Gross Margins 2015 2016 2017 2018 2019 2020 2021 2022 2023 10 20 30 40 50

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7

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.
The number of shares outstanding for PYPL has been reduced compared to 1 year ago.
Compared to 5 years ago, PYPL has less shares outstanding
The debt/assets ratio for PYPL has been reduced compared to a year ago.
PYPL Yearly Shares OutstandingPYPL Yearly Shares OutstandingYearly Shares Outstanding 2015 2016 2017 2018 2019 2020 2021 2022 2023 200M 400M 600M 800M 1B
PYPL Yearly Total Debt VS Total AssetsPYPL Yearly Total Debt VS Total AssetsYearly Total Debt VS Total Assets 2015 2016 2017 2018 2019 2020 2021 2022 2023 20B 40B 60B 80B

2.2 Solvency

An Altman-Z score of 2.09 indicates that PYPL is not a great score, but indicates 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 74.26% of its industry peers.
PYPL has a debt to FCF ratio of 1.77. This is a very positive value and a sign of high solvency as it would only need 1.77 years to pay back of all of its debts.
PYPL has a better Debt to FCF ratio (1.77) than 73.27% of its industry peers.
A Debt/Equity ratio of 0.50 indicates that PYPL is not too dependend on debt financing.
PYPL has a Debt to Equity ratio (0.50) which is comparable to the rest of the industry.
Industry RankSector Rank
Debt/Equity 0.5
Debt/FCF 1.77
Altman-Z 2.09
ROIC/WACC1.51
WACC8.51%
PYPL Yearly LT Debt VS Equity VS FCFPYPL Yearly LT Debt VS Equity VS FCFYearly LT Debt VS Equity VS FCF 2015 2016 2017 2018 2019 2020 2021 2022 2023 5B 10B 15B 20B

2.3 Liquidity

PYPL has a Current Ratio of 1.25. 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 1.25, PYPL is in the better half of the industry, outperforming 60.40% of the companies in the same industry.
PYPL has a Quick Ratio of 1.25. 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 Quick ratio, with a value of 1.25, PYPL is in the better half of the industry, outperforming 61.39% of the companies in the same industry.
Industry RankSector Rank
Current Ratio 1.25
Quick Ratio 1.25
PYPL Yearly Current Assets VS Current LiabilitesPYPL Yearly Current Assets VS Current LiabilitesYearly Current Assets VS Current Liabilites 2015 2016 2017 2018 2019 2020 2021 2022 2023 20B 40B 60B

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4

3. Growth

3.1 Past

PYPL shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 8.21%, which is quite good.
PYPL shows quite a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 16.12% yearly.
PYPL shows a small growth in Revenue. In the last year, the Revenue has grown by 8.00%.
PYPL shows quite a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 14.02% yearly.
EPS 1Y (TTM)8.21%
EPS 3Y8.06%
EPS 5Y16.12%
EPS Q2Q%-7.69%
Revenue 1Y (TTM)8%
Revenue growth 3Y11.54%
Revenue growth 5Y14.02%
Sales Q2Q%5.78%

3.2 Future

Based on estimates for the next years, PYPL will show a small growth in Earnings Per Share. The EPS will grow by 7.66% on average per year.
Based on estimates for the next years, PYPL will show a small growth in Revenue. The Revenue will grow by 7.09% on average per year.
EPS Next Y-8.64%
EPS Next 2Y-1.24%
EPS Next 3Y2.69%
EPS Next 5Y7.66%
Revenue Next Year7.01%
Revenue Next 2Y6.33%
Revenue Next 3Y6.49%
Revenue Next 5Y7.09%

3.3 Evolution

When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
The Revenue growth rate is decreasing: in the next years the growth will be less than in the last years.
PYPL Yearly Revenue VS EstimatesPYPL Yearly Revenue VS EstimatesYearly Revenue VS Estimates 2014 2016 2018 2020 2022 2024 2026 2028 2030 2032 10B 20B 30B 40B 50B
PYPL Yearly EPS VS EstimatesPYPL Yearly EPS VS EstimatesYearly EPS VS Estimates 2014 2016 2018 2020 2022 2024 2026 2028 2030 2032 2 4 6 8 10

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4

4. Valuation

4.1 Price/Earnings Ratio

PYPL is valuated rather expensively with a Price/Earnings ratio of 17.42.
PYPL's Price/Earnings ratio is in line with the industry average.
PYPL's Price/Earnings ratio indicates a valuation a bit cheaper than the S&P500 average which is at 27.94.
A Price/Forward Earnings ratio of 18.42 indicates a rather expensive valuation of PYPL.
PYPL's Price/Forward Earnings ratio is in line with the industry average.
PYPL is valuated rather cheaply when we compare the Price/Forward Earnings ratio to 24.11, which is the current average of the S&P500 Index.
Industry RankSector Rank
PE 17.42
Fwd PE 18.42
PYPL Price Earnings VS Forward Price EarningsPYPL Price Earnings VS Forward Price Earnings ChartPrice Earnings - Forward Price Earnings PE FPE 5 10 15 20 25

4.2 Price Multiples

65.35% of the companies in the same industry are more expensive than PYPL, based on the Enterprise Value to EBITDA ratio.
Based on the Price/Free Cash Flow ratio, PYPL is valued a bit cheaper than 75.25% of the companies in the same industry.
Industry RankSector Rank
P/FCF 13.07
EV/EBITDA 13.06
PYPL Per share dataPYPL EPS, Sales, OCF, FCF, BookValue per sharePer Share Data Per Share 10 20 30

4.3 Compensation for Growth

The decent profitability rating of PYPL may justify a higher PE ratio.
PEG (NY)N/A
PEG (5Y)1.08
EPS Next 2Y-1.24%
EPS Next 3Y2.69%

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0

5. Dividend

5.1 Amount

PYPL does not give a dividend.
Industry RankSector Rank
Dividend Yield N/A

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PAYPAL HOLDINGS INC

NASDAQ:PYPL (1/17/2025, 8:23:07 PM)

After market: 91.83 +0.02 (+0.02%)

91.81

+2.89 (+3.25%)

Chartmill FA Rating
GICS SectorFinancials
GICS IndustryGroupFinancial Services
GICS IndustryFinancial Services
Earnings (Last)10-29 2024-10-29/bmo
Earnings (Next)02-04 2025-02-04/amc
Inst Owners74.06%
Inst Owner Change-0.33%
Ins Owners0.07%
Ins Owner Change0.24%
Market Cap92.04B
Analysts74.81
Price Target95.38 (3.89%)
Short Float %2.68%
Short Ratio3.06
Dividend
Industry RankSector 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)14.14%
Min EPS beat(2)10.02%
Max EPS beat(2)18.26%
EPS beat(4)4
Avg EPS beat(4)11.89%
Min EPS beat(4)6.45%
Max EPS beat(4)18.26%
EPS beat(8)7
Avg EPS beat(8)6.87%
EPS beat(12)9
Avg EPS beat(12)5.57%
EPS beat(16)13
Avg EPS beat(16)5.8%
Revenue beat(2)0
Avg Revenue beat(2)-1.79%
Min Revenue beat(2)-2.46%
Max Revenue beat(2)-1.13%
Revenue beat(4)1
Avg Revenue beat(4)-0.79%
Min Revenue beat(4)-2.46%
Max Revenue beat(4)0.47%
Revenue beat(8)1
Avg Revenue beat(8)-1.2%
Revenue beat(12)1
Avg Revenue beat(12)-1.22%
Revenue beat(16)2
Avg Revenue beat(16)-1.32%
PT rev (1m)2.78%
PT rev (3m)15.1%
EPS NQ rev (1m)0%
EPS NQ rev (3m)-1.02%
EPS NY rev (1m)0%
EPS NY rev (3m)3.33%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)-3.3%
Revenue NY rev (1m)-0.02%
Revenue NY rev (3m)-0.76%
Valuation
Industry RankSector Rank
PE 17.42
Fwd PE 18.42
P/S 2.93
P/FCF 13.07
P/OCF 12
P/B 4.56
P/tB 10.48
EV/EBITDA 13.06
EPS(TTM)5.27
EY5.74%
EPS(NY)4.98
Fwd EY5.43%
FCF(TTM)7.03
FCFY7.65%
OCF(TTM)7.65
OCFY8.33%
SpS31.38
BVpS20.12
TBVpS8.76
PEG (NY)N/A
PEG (5Y)1.08
Profitability
Industry RankSector Rank
ROA 5.3%
ROE 21.95%
ROCE 17.11%
ROIC 12.86%
ROICexc 20.05%
ROICexgc 43.04%
OM 18.09%
PM (TTM) 14.08%
GM 40.1%
FCFM 22.4%
ROA(3y)4.58%
ROA(5y)4.9%
ROE(3y)17.1%
ROE(5y)17.37%
ROIC(3y)10%
ROIC(5y)9.33%
ROICexc(3y)15.39%
ROICexc(5y)15.03%
ROICexgc(3y)34.97%
ROICexgc(5y)33.17%
ROCE(3y)13.3%
ROCE(5y)12.41%
ROICexcg growth 3Y16.01%
ROICexcg growth 5Y-4.74%
ROICexc growth 3Y11.6%
ROICexc growth 5Y0.74%
OM growth 3Y1.29%
OM growth 5Y0.5%
PM growth 3Y-10.03%
PM growth 5Y1.39%
GM growth 3Y-5.3%
GM growth 5Y-2.98%
F-Score6
Asset Turnover0.38
Health
Industry RankSector Rank
Debt/Equity 0.5
Debt/FCF 1.77
Debt/EBITDA 1.48
Cap/Depr 59.75%
Cap/Sales 1.99%
Interest Coverage 17.14
Cash Conversion 113.88%
Profit Quality 159.1%
Current Ratio 1.25
Quick Ratio 1.25
Altman-Z 2.09
F-Score6
WACC8.51%
ROIC/WACC1.51
Cap/Depr(3y)61.17%
Cap/Depr(5y)66.71%
Cap/Sales(3y)2.75%
Cap/Sales(5y)3.25%
Profit Quality(3y)142.59%
Profit Quality(5y)138.42%
High Growth Momentum
Growth
EPS 1Y (TTM)8.21%
EPS 3Y8.06%
EPS 5Y16.12%
EPS Q2Q%-7.69%
EPS Next Y-8.64%
EPS Next 2Y-1.24%
EPS Next 3Y2.69%
EPS Next 5Y7.66%
Revenue 1Y (TTM)8%
Revenue growth 3Y11.54%
Revenue growth 5Y14.02%
Sales Q2Q%5.78%
Revenue Next Year7.01%
Revenue Next 2Y6.33%
Revenue Next 3Y6.49%
Revenue Next 5Y7.09%
EBIT growth 1Y18.62%
EBIT growth 3Y12.98%
EBIT growth 5Y14.58%
EBIT Next Year4.56%
EBIT Next 3Y4.82%
EBIT Next 5Y6.45%
FCF growth 1Y50.5%
FCF growth 3Y-7.62%
FCF growth 5Y-1.95%
OCF growth 1Y40.94%
OCF growth 3Y-8%
OCF growth 5Y-2.44%