PAYPAL HOLDINGS INC (PYPL)
US70450Y1038 - Common Stock
We assign a fundamental rating of 6 out of 10 to PYPL. PYPL was compared to 102 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 priced too expensively while it is growing strongly. Keep and eye on this one! With these ratings, PYPL could be worth investigating further for growth investing!.
1. Profitability
1.1 Basic Checks
In the past year PYPL was profitable.
PYPL had a positive operating cash flow in the past year.
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
Looking at the Return On Assets, with a value of 5.17%, PYPL belongs to the top of the industry, outperforming 81.37% of the companies in the same industry.
PYPL has a Return On Equity of 20.17%. This is amongst the best in the industry. PYPL outperforms 85.29% of its industry peers.
The Return On Invested Capital of PYPL (11.03%) is better than 86.27% of its industry peers.
PYPL had an Average Return On Invested Capital over the past 3 years of 10.00%. This is above the industry average of 7.93%.
The 3 year average ROIC (10.00%) for PYPL is below the current ROIC(11.03%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 5.17% | ||
| ROE | 20.17% | ||
| ROIC | 11.03% |
ROA(3y)4.58%
ROA(5y)4.9%
ROE(3y)17.1%
ROE(5y)17.37%
ROIC(3y)10%
ROIC(5y)9.33%
1.3 Margins
PYPL has a Profit Margin of 14.26%. This is in the better half of the industry: PYPL outperforms 66.67% 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 16.62% is in line compared to the rest of the industry. PYPL outperforms 58.82% of its industry peers.
PYPL's Operating Margin has been stable in the last couple of years.
PYPL has a Gross Margin (39.59%) which is comparable to the rest of the industry.
PYPL's Gross Margin has declined in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 16.62% | ||
| PM (TTM) | 14.26% | ||
| GM | 39.59% |
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%
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.
Compared to 1 year ago, PYPL has less shares outstanding
The number of shares outstanding for PYPL has been reduced compared to 5 years ago.
The debt/assets ratio for PYPL has been reduced compared to a year ago.
2.2 Solvency
An Altman-Z score of 1.86 indicates that PYPL is not a great score, but indicates only limited risk for bankruptcy at the moment.
PYPL has a better Altman-Z score (1.86) than 75.49% of its industry peers.
PYPL has a debt to FCF ratio of 2.59. This is a good value and a sign of high solvency as PYPL would need 2.59 years to pay back of all of its debts.
With a decent Debt to FCF ratio value of 2.59, PYPL is doing good in the industry, outperforming 73.53% of the companies in the same industry.
A Debt/Equity ratio of 0.46 indicates that PYPL is not too dependend on debt financing.
The Debt to Equity ratio of PYPL (0.46) is comparable to the rest of the industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.46 | ||
| Debt/FCF | 2.59 | ||
| Altman-Z | 1.86 |
ROIC/WACC1.32
WACC8.33%
2.3 Liquidity
PYPL has a Current Ratio of 1.29. This is a normal value and indicates that PYPL is financially healthy and should not expect problems in meeting its short term obligations.
With a Current ratio value of 1.29, PYPL perfoms like the industry average, outperforming 59.80% of the companies in the same industry.
A Quick Ratio of 1.29 indicates that PYPL should not have too much problems paying its short term obligations.
With a decent Quick ratio value of 1.29, PYPL is doing good in the industry, outperforming 61.76% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.29 | ||
| Quick Ratio | 1.29 |
3. Growth
3.1 Past
PYPL shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 23.73%, which is quite impressive.
PYPL shows quite a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 16.12% yearly.
The Revenue has grown by 8.19% in the past year. This is quite good.
The Revenue has been growing by 14.02% on average over the past years. This is quite good.
EPS 1Y (TTM)23.73%
EPS 3Y8.06%
EPS 5Y16.12%
EPS growth Q2Q19.35%
Revenue 1Y (TTM)8.19%
Revenue growth 3Y11.54%
Revenue growth 5Y14.02%
Revenue growth Q2Q8.71%
3.2 Future
PYPL is expected to show quite a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 15.88% yearly.
The Revenue is expected to grow by 11.06% on average over the next years. This is quite good.
EPS Next Y1.18%
EPS Next 2Y5.7%
EPS Next 3Y6.35%
EPS Next 5Y15.88%
Revenue Next Year7.57%
Revenue Next 2Y7.69%
Revenue Next 3Y7.64%
Revenue Next 5Y11.06%
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.
Although the future Revenue growth is still strong, it is not able to hold up the even more excellent growth rate of the past years.
4. Valuation
4.1 Price/Earnings Ratio
A Price/Earnings ratio of 12.94 indicates a correct valuation of PYPL.
Based on the Price/Earnings ratio, PYPL is valued a bit cheaper than the industry average as 65.69% of the companies are valued more expensively.
PYPL's Price/Earnings ratio indicates a valuation a bit cheaper than the S&P500 average which is at 24.67.
Based on the Price/Forward Earnings ratio of 12.79, the valuation of PYPL can be described as correct.
Compared to the rest of the industry, the Price/Forward Earnings ratio of PYPL is on the same level as its industry peers.
Compared to an average S&P500 Price/Forward Earnings ratio of 21.02, PYPL is valued a bit cheaper.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 12.94 | ||
| Fwd PE | 12.79 |
4.2 Price Multiples
73.53% of the companies in the same industry are more expensive than PYPL, based on the Enterprise Value to EBITDA ratio.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of PYPL indicates a somewhat cheap valuation: PYPL is cheaper than 63.73% of the companies listed in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 16.5 | ||
| EV/EBITDA | 10.53 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates PYPL does not grow enough to justify the current Price/Earnings ratio.
PYPL has a very decent profitability rating, which may justify a higher PE ratio.
PEG (NY)10.93
PEG (5Y)0.8
EPS Next 2Y5.7%
EPS Next 3Y6.35%
5. Dividend
5.1 Amount
No dividends for PYPL!.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
PAYPAL HOLDINGS INC
NASDAQ:PYPL (5/1/2024, 4:12:56 PM)
After market: 66.21 +0.07 (+0.11%)66.14
-1.78 (-2.62%)
Chartmill FA Rating
GICS SectorFinancials
GICS IndustryGroupFinancial Services
GICS IndustryFinancial Services
Earnings (Last)
Earnings (Next)
Inst Owners
Inst Owner Change
Ins Owners
Ins Owner Change
Market Cap69.62B
Analysts
Price Target
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
Dividend Growth(5Y)
DP
Div Incr Years
Div Non Decr Years
Ex-Date
Surprises & Revisions
EPS beat(2)
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EPS beat(8)
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EPS beat(16)
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Revenue beat(2)
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PT rev (1m)
PT rev (3m)
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Revenue NQ rev (1m)
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Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 12.94 | ||
| Fwd PE | 12.79 | ||
| P/S | |||
| P/FCF | |||
| P/OCF | |||
| P/B | |||
| P/tB | |||
| EV/EBITDA |
EPS(TTM)
EY
EPS(NY)
Fwd EY
FCF(TTM)
FCFY
OCF(TTM)
OCFY
SpS
BVpS
TBVpS
PEG (NY)10.93
PEG (5Y)0.8
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 5.17% | ||
| ROE | 20.17% | ||
| ROCE | |||
| ROIC | |||
| ROICexc | |||
| ROICexgc | |||
| OM | 16.62% | ||
| PM (TTM) | 14.26% | ||
| GM | 39.59% | ||
| FCFM |
ROA(3y)
ROA(5y)
ROE(3y)
ROE(5y)
ROIC(3y)
ROIC(5y)
ROICexc(3y)
ROICexc(5y)
ROICexgc(3y)
ROICexgc(5y)
ROCE(3y)
ROCE(5y)
ROICexcg growth 3Y
ROICexcg growth 5Y
ROICexc growth 3Y
ROICexc growth 5Y
OM growth 3Y
OM growth 5Y
PM growth 3Y
PM growth 5Y
GM growth 3Y
GM growth 5Y
F-Score
Asset Turnover0.36
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.46 | ||
| Debt/FCF | |||
| Debt/EBITDA | |||
| Cap/Depr | |||
| Cap/Sales | |||
| Interest Coverage | |||
| Cash Conversion | |||
| Profit Quality | |||
| Current Ratio | 1.29 | ||
| Quick Ratio | 1.29 | ||
| Altman-Z |
F-Score
WACC
ROIC/WACC
Cap/Depr(3y)
Cap/Depr(5y)
Cap/Sales(3y)
Cap/Sales(5y)
Profit Quality(3y)
Profit Quality(5y)
Growth
EPS 1Y (TTM)23.73%
EPS 3Y8.06%
EPS 5Y
EPS growth Q2Q
EPS Next Y1.18%
EPS Next 2Y
EPS Next 3Y
EPS Next 5Y
Revenue 1Y (TTM)8.19%
Revenue growth 3Y11.54%
Revenue growth 5Y
Revenue growth Q2Q
Revenue Next Year
Revenue Next 2Y
Revenue Next 3Y
Revenue Next 5Y
EBIT growth 1Y
EBIT growth 3Y
EBIT growth 5Y
EBIT Next Year
EBIT Next 3Y
EBIT Next 5Y
FCF growth 1Y
FCF growth 3Y
FCF growth 5Y
OCF growth 1Y
OCF growth 3Y
OCF growth 5Y