PayPal: Time To Double Down


  • PayPal lost more than 15% in value after a double beat on revenue and EPS.
  • Analysts are causing fear by overblowing lower operating margin guidance when prices are low.
  • On a valuation aspect, PayPal is by far the cheapest in the sector, with the stock trading at 12.5x forward price-to-earnings ratio and a free cash flow yield of 7.17%.
  • Although stock-based compensation is still way too high, it is finally shrinking while increasing the effectiveness of the $4 billion in stock buybacks for FY23.

PayPal (NASDAQ:PYPL) has lost favour of investors since the end of 2021 and has been consolidating over the past year. As some of you already know, I like to be a contrarian, this time around PayPal is my contrarian idea. The sentiment