PAYPAL HOLDINGS INC (2PP.DE) Stock Fundamental Analysis
FRA:2PP - Deutsche Boerse Ag - US70450Y1038 - Common Stock - Currency: EUR
We assign a fundamental rating of 5 out of 10 to 2PP. 2PP was compared to 51 industry peers in the Financial Services industry. While 2PP has a great profitability rating, 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.
2PP had a positive operating cash flow in the past year.
2PP had positive earnings in each of the past 5 years.
Each year in the past 5 years 2PP had a positive operating cash flow.
1.2 Ratios
2PP has a Return On Assets of 5.59%. This is in the better half of the industry: 2PP outperforms 70.59% of its industry peers.
2PP has a better Return On Equity (22.44%) than 78.43% of its industry peers.
The Return On Invested Capital of 2PP (13.48%) is better than 80.39% of its industry peers.
The Average Return On Invested Capital over the past 3 years for 2PP is in line with the industry average of 11.50%.
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 line with its industry, outperforming 54.90% 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.
The Operating Margin of 2PP (18.75%) is better than 60.78% of its industry peers.
2PP's Operating Margin has improved in the last couple of years.
2PP has a Gross Margin of 41.40%. This is comparable to the rest of the industry: 2PP outperforms 45.10% of its industry peers.
2PP's Gross Margin has declined in the last couple of years.
| 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
The Return on Invested Capital (ROIC) is just above the Cost of Capital (WACC), so 2PP is still creating some 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 2.07 indicates that 2PP is not a great score, but indicates only limited risk for bankruptcy at the moment.
2PP has a Altman-Z score (2.07) which is in line with its industry peers.
The Debt to FCF ratio of 2PP is 2.12, which is a good value as it means it would take 2PP, 2.12 years of fcf income to pay off all of its debts.
With a decent Debt to FCF ratio value of 2.12, 2PP is doing good in the industry, outperforming 76.47% of the companies in the same industry.
2PP has a Debt/Equity ratio of 0.56. This is a neutral value indicating 2PP is somewhat dependend on debt financing.
2PP has a Debt to Equity ratio (0.56) which is comparable to the rest of the 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 | 2.07 |
ROIC/WACC1.67
WACC8.09%
2.3 Liquidity
A Current Ratio of 1.30 indicates that 2PP should not have too much problems paying its short term obligations.
The Current ratio of 2PP (1.30) is better than 64.71% of its industry peers.
2PP has a Quick 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.
2PP has a Quick ratio of 1.30. This is in the better half of the industry: 2PP outperforms 66.67% 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%.
The Earnings Per Share has been growing by 9.87% on average over the past years. This is quite good.
2PP shows a small growth in Revenue. In the last year, the Revenue has grown by 4.79%.
Measured over the past years, 2PP shows a quite strong growth in Revenue. The Revenue has been growing by 12.34% on average per year.
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.
The Revenue is expected to grow by 5.57% on average over the next years.
EPS Next Y4.45%
EPS Next 2Y7.59%
EPS Next 3Y9.57%
EPS Next 5Y11.09%
Revenue Next Year3.06%
Revenue Next 2Y4.39%
Revenue Next 3Y5.34%
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
2PP is valuated correctly with a Price/Earnings ratio of 15.21.
The rest of the industry has a similar Price/Earnings ratio as 2PP.
When comparing the Price/Earnings ratio of 2PP to the average of the S&P500 Index (27.30), we can say 2PP is valued slightly cheaper.
2PP is valuated correctly with a Price/Forward Earnings ratio of 12.94.
2PP's Price/Forward Earnings is on the same level as the industry average.
When comparing the Price/Forward Earnings ratio of 2PP to the average of the S&P500 Index (21.76), we can say 2PP is valued slightly cheaper.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 15.21 | ||
| Fwd PE | 12.94 |
4.2 Price Multiples
The rest of the industry has a similar Enterprise Value to EBITDA ratio as 2PP.
2PP's Price/Free Cash Flow ratio is a bit cheaper when compared to the industry. 2PP is cheaper than 70.59% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 12.16 | ||
| EV/EBITDA | 10.29 |
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)3.42
PEG (5Y)1.54
EPS Next 2Y7.59%
EPS Next 3Y9.57%
5. Dividend
5.1 Amount
2PP does not give a dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
FRA:2PP (7/11/2025, 7:00:00 PM)
63.72
-1.52 (-2.33%)
Chartmill FA Rating
GICS SectorFinancials
GICS IndustryGroupFinancial Services
GICS IndustryFinancial Services
Earnings (Last)
Earnings (Next)
Inst Owners79.32%
Inst Owner ChangeN/A
Ins Owners0.09%
Ins Owner ChangeN/A
Market Cap61.97B
Analysts72.69
Price Target74.65 (17.15%)
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)8.11%
Min EPS beat(2)3.97%
Max EPS beat(2)12.26%
EPS beat(4)4
Avg EPS beat(4)11.13%
Min EPS beat(4)3.97%
Max EPS beat(4)18.26%
EPS beat(8)7
Avg EPS beat(8)8.17%
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)-1.66%
Min Revenue beat(2)-2.67%
Max Revenue beat(2)-0.65%
Revenue beat(4)0
Avg Revenue beat(4)-1.73%
Min Revenue beat(4)-2.67%
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)-1.45%
PT rev (1m)0.6%
PT rev (3m)-13.73%
EPS NQ rev (1m)0.04%
EPS NQ rev (3m)6.35%
EPS NY rev (1m)0.11%
EPS NY rev (3m)1.23%
Revenue NQ rev (1m)-0.01%
Revenue NQ rev (3m)-0.37%
Revenue NY rev (1m)-0.14%
Revenue NY rev (3m)-1.15%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 15.21 | ||
| Fwd PE | 12.94 | ||
| P/S | 2.28 | ||
| P/FCF | 12.16 | ||
| P/OCF | 10.84 | ||
| P/B | 3.58 | ||
| P/tB | 8.02 | ||
| EV/EBITDA | 10.29 |
EPS(TTM)4.19
EY6.58%
EPS(NY)4.92
Fwd EY7.73%
FCF(TTM)5.24
FCFY8.22%
OCF(TTM)5.88
OCFY9.22%
SpS28
BVpS17.79
TBVpS7.95
PEG (NY)3.42
PEG (5Y)1.54
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 | 2.07 |
F-Score8
WACC8.09%
ROIC/WACC1.67
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 Y4.45%
EPS Next 2Y7.59%
EPS Next 3Y9.57%
EPS Next 5Y11.09%
Revenue 1Y (TTM)4.79%
Revenue growth 3Y7.82%
Revenue growth 5Y12.34%
Sales Q2Q%1.19%
Revenue Next Year3.06%
Revenue Next 2Y4.39%
Revenue Next 3Y5.34%
Revenue Next 5Y5.57%
EBIT growth 1Y15.85%
EBIT growth 3Y10.05%
EBIT growth 5Y15.61%
EBIT Next Year23.59%
EBIT Next 3Y12.87%
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%