PAYPAL HOLDINGS INC (2PP.DE) Stock Fundamental Analysis
FRA:2PP - Deutsche Boerse Ag - US70450Y1038 - Common Stock - Currency: EUR
Taking everything into account, 2PP scores 5 out of 10 in our fundamental rating. 2PP was compared to 47 industry peers in the Financial Services industry. 2PP has an excellent profitability rating, but there are some minor concerns on its financial health. 2PP has a decent growth rate and is not valued too expensively.
1. Profitability
1.1 Basic Checks
2PP had positive earnings in the past year.
In the past year 2PP had a positive cash flow from operations.
2PP had positive earnings in each of the past 5 years.
2PP had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
2PP has a Return On Assets of 5.59%. This is in the better half of the industry: 2PP outperforms 70.21% of its industry peers.
With a decent Return On Equity value of 22.44%, 2PP is doing good in the industry, outperforming 78.72% of the companies in the same industry.
2PP has a better Return On Invested Capital (13.48%) than 85.11% of its industry peers.
2PP had an Average Return On Invested Capital over the past 3 years of 11.47%. This is in line with the industry average of 10.12%.
The 3 year average ROIC (11.47%) for 2PP 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
Looking at the Profit Margin, with a value of 14.26%, 2PP is in the better half of the industry, outperforming 65.96% of the companies in the same industry.
In the last couple of years the Profit Margin of 2PP has remained more or less at the same level.
2PP has a better Operating Margin (18.75%) than 68.09% of its industry peers.
In the last couple of years the Operating Margin of 2PP has grown nicely.
2PP has a Gross Margin of 41.40%. This is comparable to the rest of the industry: 2PP outperforms 46.81% of its industry peers.
In the last couple of years the Gross Margin of 2PP 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
2PP has a Return on Invested Capital (ROIC), which is below the Cost of Capital (WACC), which means it is destroying value.
2PP has less shares outstanding than it did 1 year ago.
Compared to 5 years ago, 2PP has less shares outstanding
Compared to 1 year ago, 2PP has a worse debt to assets ratio.
2.2 Solvency
An Altman-Z score of 1.97 indicates that 2PP is not a great score, but indicates only limited risk for bankruptcy at the moment.
The Altman-Z score of 2PP (1.97) is comparable to the rest of the industry.
2PP has a debt to FCF ratio of 2.12. This is a good value and a sign of high solvency as 2PP would need 2.12 years to pay back of all of its debts.
With a decent Debt to FCF ratio value of 2.12, 2PP is doing good in the industry, outperforming 76.60% of the companies in the same industry.
A Debt/Equity ratio of 0.56 indicates that 2PP is somewhat dependend on debt financing.
Looking at the Debt to Equity ratio, with a value of 0.56, 2PP is in line with its industry, outperforming 40.43% of the companies in the same industry.
Although 2PP 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 | 1.97 |
ROIC/WACC0.96
WACC14%
2.3 Liquidity
2PP has a Current Ratio of 1.30. This is a normal value and indicates that 2PP is financially healthy and should not expect problems in meeting its short term obligations.
With a decent Current ratio value of 1.30, 2PP is doing good in the industry, outperforming 61.70% of the companies in the same industry.
A Quick Ratio of 1.30 indicates that 2PP should not have too much problems paying its short term obligations.
2PP's Quick ratio of 1.30 is fine compared to the rest of the industry. 2PP outperforms 63.83% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.3 | ||
| Quick Ratio | 1.3 |
3. Growth
3.1 Past
2PP shows a slight negative growth in Earnings Per Share. In the last year, the EPS has decreased by -8.05%.
Measured over the past years, 2PP shows a quite strong growth in Earnings Per Share. The EPS has been growing by 9.87% on average per year.
2PP shows a small growth in Revenue. In the last year, the Revenue has grown by 4.79%.
2PP shows quite a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 12.34% yearly.
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
2PP is expected to show quite a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 11.09% yearly.
2PP is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 5.57% yearly.
EPS Next Y2.67%
EPS Next 2Y6.88%
EPS Next 3Y8.91%
EPS Next 5Y11.09%
Revenue Next Year3.8%
Revenue Next 2Y5.03%
Revenue Next 3Y5.49%
Revenue Next 5Y5.57%
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 stable.
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
The Price/Earnings ratio is 13.57, which indicates a correct valuation of 2PP.
The rest of the industry has a similar Price/Earnings ratio as 2PP.
Compared to an average S&P500 Price/Earnings ratio of 28.18, 2PP is valued rather cheaply.
Based on the Price/Forward Earnings ratio of 11.71, the valuation of 2PP can be described as reasonable.
Compared to the rest of the industry, the Price/Forward Earnings ratio of 2PP is on the same level as its industry peers.
2PP is valuated rather cheaply when we compare the Price/Forward Earnings ratio to 20.81, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 13.57 | ||
| Fwd PE | 11.71 |
4.2 Price Multiples
Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of 2PP indicates a somewhat cheap valuation: 2PP is cheaper than 63.83% of the companies listed in the same industry.
Based on the Price/Free Cash Flow ratio, 2PP is valued a bit cheaper than the industry average as 63.83% of the companies are valued more expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 10.86 | ||
| EV/EBITDA | 8.93 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
The decent profitability rating of 2PP may justify a higher PE ratio.
PEG (NY)5.08
PEG (5Y)1.37
EPS Next 2Y6.88%
EPS Next 3Y8.91%
5. Dividend
5.1 Amount
No dividends for 2PP!.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
FRA:2PP (5/2/2025, 7:00:00 PM)
58.74
+1.56 (+2.73%)
Chartmill FA Rating
GICS SectorFinancials
GICS IndustryGroupFinancial Services
GICS IndustryFinancial Services
Earnings (Last)
Earnings (Next)
Inst Owners77.78%
Inst Owner ChangeN/A
Ins Owners0.09%
Ins Owner ChangeN/A
Market Cap57.13B
Analysts73.21
Price Target75.3 (28.19%)
Short Float %N/A
Short RatioN/A
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)8.1%
Min EPS beat(2)3.97%
Max EPS beat(2)12.23%
EPS beat(4)4
Avg EPS beat(4)11.12%
Min EPS beat(4)3.97%
Max EPS beat(4)18.26%
EPS beat(8)7
Avg EPS beat(8)8.16%
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)-1.65%
Min Revenue beat(2)-2.65%
Max Revenue beat(2)-0.65%
Revenue beat(4)0
Avg Revenue beat(4)-1.72%
Min Revenue beat(4)-2.65%
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)-1.44%
PT rev (1m)-14.38%
PT rev (3m)-18.13%
EPS NQ rev (1m)4.96%
EPS NQ rev (3m)6.06%
EPS NY rev (1m)-0.49%
EPS NY rev (3m)2.52%
Revenue NQ rev (1m)-0.29%
Revenue NQ rev (3m)-2.08%
Revenue NY rev (1m)-0.44%
Revenue NY rev (3m)-1.69%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 13.57 | ||
| Fwd PE | 11.71 | ||
| P/S | 2.03 | ||
| P/FCF | 10.86 | ||
| P/OCF | 9.68 | ||
| P/B | 3.2 | ||
| P/tB | 7.16 | ||
| EV/EBITDA | 8.93 |
EPS(TTM)4.33
EY7.37%
EPS(NY)5.02
Fwd EY8.54%
FCF(TTM)5.41
FCFY9.21%
OCF(TTM)6.07
OCFY10.33%
SpS28.91
BVpS18.36
TBVpS8.2
PEG (NY)5.08
PEG (5Y)1.37
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 | 1.97 |
F-Score8
WACC14%
ROIC/WACC0.96
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 Y2.67%
EPS Next 2Y6.88%
EPS Next 3Y8.91%
EPS Next 5Y11.09%
Revenue 1Y (TTM)4.79%
Revenue growth 3Y7.82%
Revenue growth 5Y12.34%
Sales Q2Q%1.19%
Revenue Next Year3.8%
Revenue Next 2Y5.03%
Revenue Next 3Y5.49%
Revenue Next 5Y5.57%
EBIT growth 1Y15.85%
EBIT growth 3Y10.05%
EBIT growth 5Y15.61%
EBIT Next Year23.56%
EBIT Next 3Y13.51%
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%