Stockernumber2
Summary
- I believe that PayPal’s consistent stock buybacks will eventually lead to a supply shortage, especially as PYPL’s growth rates return to more stable levels.
- The new management at PayPal is effectively executing its strategies, and the turnaround seems to be in its early stages.
- PayPal’s financials show widening margins and a return to growth, making it an attractive investment amid undervaluation.
- My bullish stance is supported by technical analysis, which suggests that we are only at the beginning of the reversal from the multi-month downtrend.
- PYPL is still a “Buy”.
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Intro & Thesis
I initiated coverage of PayPal Holdings, Inc. (NASDAQ:PYPL) stock in May 2023 and have since authored 4 articles. The first 2 articles were published with a “Hold” rating but already in November 2023, I upgraded my rating to “Buy” after analyzing the company’s financials (as well as turnaround plans) at the time and observing an increase in its fair value. Following that update, the stock’s performance roughly tracked the broader market trends. However, after my most recent update in February 2024, PayPal’s stock has outperformed the market, surpassing the S&P 500 (SP500) (SPY) index’s return by more than 2x.
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