PAYPAL HOLDINGS INC (PYPL) Stock Fundamental Analysis
NASDAQ:PYPL - Nasdaq - US70450Y1038 - Common Stock - Currency: USD
PYPL gets a fundamental rating of 5 out of 10. The analysis compared the fundamentals against 100 industry peers in the Financial Services industry. While PYPL has a great profitability rating, there are some minor concerns on its financial health. PYPL has a correct valuation and a medium growth rate.
1. Profitability
1.1 Basic Checks
In the past year PYPL was profitable.
PYPL had a positive operating cash flow in the past year.
In the past 5 years PYPL has always 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 (5.87%) than 80.00% of its industry peers.
Looking at the Return On Equity, with a value of 23.16%, PYPL belongs to the top of the industry, outperforming 87.00% of the companies in the same industry.
PYPL has a Return On Invested Capital of 13.86%. This is amongst the best in the industry. PYPL outperforms 89.00% of its industry peers.
The Average Return On Invested Capital over the past 3 years for PYPL is above the industry average of 7.90%.
The last Return On Invested Capital (13.86%) for PYPL is above the 3 year average (11.47%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 5.87% | ||
| ROE | 23.16% | ||
| ROIC | 13.86% |
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
The Profit Margin of PYPL (14.49%) is better than 63.00% of its industry peers.
In the last couple of years the Profit Margin of PYPL has remained more or less at the same level.
The Operating Margin of PYPL (19.08%) is better than 66.00% of its industry peers.
PYPL's Operating Margin has improved in the last couple of years.
The Gross Margin of PYPL (41.68%) is comparable to the rest of the industry.
In the last couple of years the Gross Margin of PYPL has declined.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 19.08% | ||
| PM (TTM) | 14.49% | ||
| GM | 41.68% |
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 PYPL is still creating some value.
Compared to 1 year ago, PYPL has less shares outstanding
PYPL has less shares outstanding than it did 5 years ago.
PYPL has a worse debt/assets ratio than last year.
2.2 Solvency
An Altman-Z score of 2.08 indicates that PYPL is not a great score, but indicates only limited risk for bankruptcy at the moment.
With a decent Altman-Z score value of 2.08, PYPL is doing good in the industry, outperforming 80.00% of the companies in the same industry.
PYPL has a debt to FCF ratio of 2.13. This is a good value and a sign of high solvency as PYPL would need 2.13 years to pay back of all of its debts.
PYPL has a Debt to FCF ratio of 2.13. This is in the better half of the industry: PYPL outperforms 76.00% of its industry peers.
PYPL has a Debt/Equity ratio of 0.56. This is a neutral value indicating PYPL is somewhat dependend on debt financing.
PYPL has a Debt to Equity ratio (0.56) which is comparable to the rest of the industry.
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 | 2.13 | ||
| Altman-Z | 2.08 |
ROIC/WACC1.72
WACC8.06%
2.3 Liquidity
A Current Ratio of 1.33 indicates that PYPL should not have too much problems paying its short term obligations.
PYPL's Current ratio of 1.33 is in line compared to the rest of the industry. PYPL outperforms 60.00% of its industry peers.
PYPL has a Quick Ratio of 1.33. This is a normal value and indicates that PYPL is financially healthy and should not expect problems in meeting its short term obligations.
The Quick ratio of PYPL (1.33) is better than 62.00% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.33 | ||
| Quick Ratio | 1.33 |
3. Growth
3.1 Past
The earnings per share for PYPL have decreased by -4.66% in the last year.
PYPL shows quite a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 9.87% yearly.
PYPL shows a small growth in Revenue. In the last year, the Revenue has grown by 4.07%.
Measured over the past years, PYPL shows a quite strong growth in Revenue. The Revenue has been growing by 12.34% on average per year.
EPS 1Y (TTM)-4.66%
EPS 3Y2.76%
EPS 5Y9.87%
EPS Q2Q%17.65%
Revenue 1Y (TTM)4.07%
Revenue growth 3Y7.82%
Revenue growth 5Y12.34%
Sales Q2Q%5.11%
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 11.09% on average per year.
PYPL is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 5.57% yearly.
EPS Next Y4.29%
EPS Next 2Y7.57%
EPS Next 3Y9.24%
EPS Next 5Y11.09%
Revenue Next Year3.12%
Revenue Next 2Y4.41%
Revenue Next 3Y5.28%
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
With a Price/Earnings ratio of 13.49, PYPL is valued correctly.
Compared to the rest of the industry, the Price/Earnings ratio of PYPL is on the same level as its industry peers.
PYPL's Price/Earnings ratio indicates a valuation a bit cheaper than the S&P500 average which is at 26.82.
A Price/Forward Earnings ratio of 11.99 indicates a reasonable valuation of PYPL.
The rest of the industry has a similar Price/Forward Earnings ratio as PYPL.
When comparing the Price/Forward Earnings ratio of PYPL to the average of the S&P500 Index (35.24), we can say PYPL is valued rather cheaply.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 13.49 | ||
| Fwd PE | 11.99 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, PYPL is valued a bit cheaper than 74.00% of the companies in the same industry.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of PYPL indicates a somewhat cheap valuation: PYPL is cheaper than 71.00% of the companies listed in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 12.47 | ||
| EV/EBITDA | 9.01 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
PYPL has a very decent profitability rating, which may justify a higher PE ratio.
PEG (NY)3.14
PEG (5Y)1.37
EPS Next 2Y7.57%
EPS Next 3Y9.24%
5. Dividend
5.1 Amount
PYPL does not give a dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
NASDAQ:PYPL (8/19/2025, 3:57:10 PM)
69.065
-0.47 (-0.67%)
Chartmill FA Rating
GICS SectorFinancials
GICS IndustryGroupFinancial Services
GICS IndustryFinancial Services
Earnings (Last)
Earnings (Next)
Inst Owners80.95%
Inst Owner Change-1.17%
Ins Owners0.1%
Ins Owner Change0.2%
Market Cap65.98B
Analysts72.8
Price Target84.35 (22.13%)
Short Float %3.15%
Short Ratio2.7
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)9.05%
Min EPS beat(2)5.83%
Max EPS beat(2)12.26%
EPS beat(4)4
Avg EPS beat(4)8.02%
Min EPS beat(4)3.97%
Max EPS beat(4)12.26%
EPS beat(8)8
Avg EPS beat(8)9.18%
EPS beat(12)11
Avg EPS beat(12)7.29%
EPS beat(16)13
Avg EPS beat(16)5.65%
Revenue beat(2)1
Avg Revenue beat(2)-1.06%
Min Revenue beat(2)-2.67%
Max Revenue beat(2)0.55%
Revenue beat(4)1
Avg Revenue beat(4)-1.31%
Min Revenue beat(4)-2.67%
Max Revenue beat(4)0.55%
Revenue beat(8)2
Avg Revenue beat(8)-0.93%
Revenue beat(12)2
Avg Revenue beat(12)-1.16%
Revenue beat(16)2
Avg Revenue beat(16)-1.26%
PT rev (1m)1.32%
PT rev (3m)0.65%
EPS NQ rev (1m)0.51%
EPS NQ rev (3m)-5.47%
EPS NY rev (1m)0%
EPS NY rev (3m)1.58%
Revenue NQ rev (1m)1%
Revenue NQ rev (3m)0.04%
Revenue NY rev (1m)0.05%
Revenue NY rev (3m)-0.12%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 13.49 | ||
| Fwd PE | 11.99 | ||
| P/S | 2.04 | ||
| P/FCF | 12.47 | ||
| P/OCF | 10.88 | ||
| P/B | 3.27 | ||
| P/tB | 7.37 | ||
| EV/EBITDA | 9.01 |
EPS(TTM)5.12
EY7.41%
EPS(NY)5.76
Fwd EY8.34%
FCF(TTM)5.54
FCFY8.02%
OCF(TTM)6.35
OCFY9.19%
SpS33.8
BVpS21.14
TBVpS9.37
PEG (NY)3.14
PEG (5Y)1.37
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 5.87% | ||
| ROE | 23.16% | ||
| ROCE | 17.74% | ||
| ROIC | 13.86% | ||
| ROICexc | 19.48% | ||
| ROICexgc | 35.74% | ||
| OM | 19.08% | ||
| PM (TTM) | 14.49% | ||
| GM | 41.68% | ||
| FCFM | 16.39% |
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 Turnover0.4
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.56 | ||
| Debt/FCF | 2.13 | ||
| Debt/EBITDA | 1.58 | ||
| Cap/Depr | 78.34% | ||
| Cap/Sales | 2.4% | ||
| Interest Coverage | 15.76 | ||
| Cash Conversion | 84.85% | ||
| Profit Quality | 113.1% | ||
| Current Ratio | 1.33 | ||
| Quick Ratio | 1.33 | ||
| Altman-Z | 2.08 |
F-Score8
WACC8.06%
ROIC/WACC1.72
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)-4.66%
EPS 3Y2.76%
EPS 5Y9.87%
EPS Q2Q%17.65%
EPS Next Y4.29%
EPS Next 2Y7.57%
EPS Next 3Y9.24%
EPS Next 5Y11.09%
Revenue 1Y (TTM)4.07%
Revenue growth 3Y7.82%
Revenue growth 5Y12.34%
Sales Q2Q%5.11%
Revenue Next Year3.12%
Revenue Next 2Y4.41%
Revenue Next 3Y5.28%
Revenue Next 5Y5.57%
EBIT growth 1Y13.21%
EBIT growth 3Y10.05%
EBIT growth 5Y15.61%
EBIT Next Year23.08%
EBIT Next 3Y12.19%
EBIT Next 5Y10.05%
FCF growth 1Y44.75%
FCF growth 3Y11.44%
FCF growth 5Y14.98%
OCF growth 1Y40.55%
OCF growth 3Y8.72%
OCF growth 5Y12.85%