56.62 USD
-0.53 (-0.93%)
56.61 USD
-0.01 (-0.02%)
PYPL gets a fundamental rating of 6 out of 10. The analysis compared the fundamentals against 97 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 decent growth rate and is not valued too expensively.
1. Profitability
1.1 Basic Checks
- PYPL had positive earnings in the past year.
- In the past year PYPL had a positive cash flow from operations.
- Each year in the past 5 years PYPL has been profitable.
- PYPL had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
- With a decent Return On Assets value of 6.16%, PYPL is doing good in the industry, outperforming 78.35% of the companies in the same industry.
- With an excellent Return On Equity value of 24.34%, PYPL belongs to the best of the industry, outperforming 89.69% of the companies in the same industry.
- With an excellent Return On Invested Capital value of 14.11%, PYPL belongs to the best of the industry, outperforming 90.72% of the companies in the same industry.
- PYPL had an Average Return On Invested Capital over the past 3 years of 11.47%. This is above the industry average of 8.44%.
- The last Return On Invested Capital (14.11%) for PYPL is above the 3 year average (11.47%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 6.16% | ||
| ROE | 24.34% | ||
| ROIC | 14.11% |
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 14.96%, PYPL is in line with its industry, outperforming 58.76% of the companies in the same industry.
- PYPL's Profit Margin has been stable in the last couple of years.
- PYPL's Operating Margin of 19.16% is fine compared to the rest of the industry. PYPL outperforms 67.01% of its industry peers.
- PYPL's Operating Margin has improved in the last couple of years.
- PYPL's Gross Margin of 41.56% is fine compared to the rest of the industry. PYPL outperforms 60.82% of its industry peers.
- In the last couple of years the Gross Margin of PYPL has declined.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 19.16% | ||
| PM (TTM) | 14.96% | ||
| GM | 41.56% |
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
- PYPL has a Return on Invested Capital (ROIC), which is just above the Cost of Capital (WACC), which means it is creating some value.
- PYPL has less shares outstanding than it did 1 year ago.
- The number of shares outstanding for PYPL has been reduced compared to 5 years ago.
- The debt/assets ratio for PYPL is higher compared to a year ago.
2.2 Solvency
- An Altman-Z score of 1.98 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 1.98, PYPL is doing good in the industry, outperforming 76.29% of the companies in the same industry.
- The Debt to FCF ratio of PYPL is 2.06, which is a good value as it means it would take PYPL, 2.06 years of fcf income to pay off all of its debts.
- With a decent Debt to FCF ratio value of 2.06, PYPL is doing good in the industry, outperforming 73.20% of the companies in the same industry.
- A Debt/Equity ratio of 0.56 indicates that PYPL is somewhat dependend on debt financing.
- Looking at the Debt to Equity ratio, with a value of 0.56, PYPL is in line with its industry, outperforming 53.61% of the companies in the same 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 | 2.06 | ||
| Altman-Z | 1.98 |
ROIC/WACC1.79
WACC7.86%
2.3 Liquidity
- A Current Ratio of 1.34 indicates that PYPL should not have too much problems paying its short term obligations.
- Looking at the Current ratio, with a value of 1.34, PYPL is in the better half of the industry, outperforming 63.92% of the companies in the same industry.
- PYPL has a Quick Ratio of 1.34. 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 (1.34) is better than 64.95% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.34 | ||
| Quick Ratio | 1.34 |
3. Growth
3.1 Past
- The earnings per share for PYPL have decreased by -0.19% in the last year.
- Measured over the past years, PYPL shows a quite strong growth in Earnings Per Share. The EPS has been growing by 9.87% on average per year.
- Looking at the last year, PYPL shows a small growth in Revenue. The Revenue has grown by 4.47% in the last year.
- PYPL shows quite a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 12.34% yearly.
EPS 1Y (TTM)-0.19%
EPS 3Y2.76%
EPS 5Y9.87%
EPS Q2Q%11.67%
Revenue 1Y (TTM)4.47%
Revenue growth 3Y7.82%
Revenue growth 5Y12.34%
Sales Q2Q%7.26%
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 13.14% on average per year.
- Based on estimates for the next years, PYPL will show a small growth in Revenue. The Revenue will grow by 6.28% on average per year.
EPS Next Y9.71%
EPS Next 2Y8.71%
EPS Next 3Y9.86%
EPS Next 5Y13.14%
Revenue Next Year5.07%
Revenue Next 2Y5.38%
Revenue Next 3Y5.72%
Revenue Next 5Y6.28%
3.3 Evolution
- The EPS growth rate is accelerating: in the next years the growth will be better than in the last years.
- When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
4. Valuation
4.1 Price/Earnings Ratio
- With a Price/Earnings ratio of 10.76, the valuation of PYPL can be described as very reasonable.
- PYPL's Price/Earnings ratio is a bit cheaper when compared to the industry. PYPL is cheaper than 61.86% of the companies in the same industry.
- Compared to an average S&P500 Price/Earnings ratio of 27.21, PYPL is valued rather cheaply.
- A Price/Forward Earnings ratio of 9.62 indicates a reasonable valuation of PYPL.
- The rest of the industry has a similar Price/Forward Earnings ratio as PYPL.
- The average S&P500 Price/Forward Earnings ratio is at 24.26. PYPL is valued rather cheaply when compared to this.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 10.76 | ||
| Fwd PE | 9.62 |
4.2 Price Multiples
- PYPL's Enterprise Value to EBITDA ratio is rather cheap when compared to the industry. PYPL is cheaper than 83.51% 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 75.26% of the companies listed in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 9.52 | ||
| EV/EBITDA | 7.14 |
4.3 Compensation for Growth
- The PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
- The decent profitability rating of PYPL may justify a higher PE ratio.
PEG (NY)1.11
PEG (5Y)1.09
EPS Next 2Y8.71%
EPS Next 3Y9.86%
5. Dividend
5.1 Amount
- PYPL has a yearly dividend return of 0.98%, which is pretty low.
- Compared to an average industry Dividend Yield of 2.32, PYPL has a dividend in line with its industry peers.
- With a Dividend Yield of 0.98, PYPL pays less dividend than the S&P500 average, which is at 1.81.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.98% |
5.2 History
- PYPL does not have a reliable dividend history as it only pays dividend since a couple or years.
Dividend Growth(5Y)N/A
Div Incr Years0
Div Non Decr Years0
5.3 Sustainability
DPN/A
EPS Next 2Y8.71%
EPS Next 3Y9.86%
PAYPAL HOLDINGS INC / PYPL FAQ
Can you provide the ChartMill fundamental rating for PAYPAL HOLDINGS INC?
ChartMill assigns a fundamental rating of 6 / 10 to PYPL.
What is the valuation status of PAYPAL HOLDINGS INC (PYPL) stock?
ChartMill assigns a valuation rating of 7 / 10 to PAYPAL HOLDINGS INC (PYPL). This can be considered as Undervalued.
Can you provide the profitability details for PAYPAL HOLDINGS INC?
PAYPAL HOLDINGS INC (PYPL) has a profitability rating of 7 / 10.
What is the financial health of PAYPAL HOLDINGS INC (PYPL) stock?
The financial health rating of PAYPAL HOLDINGS INC (PYPL) is 6 / 10.
Can you provide the expected EPS growth for PYPL stock?
The Earnings per Share (EPS) of PAYPAL HOLDINGS INC (PYPL) is expected to grow by 9.71% in the next year.