PYPL

PayPal Holdings Inc

Finance/Real Estate, TMT


Presented:10/25/2019
Price:$107.19
Cap:$126.13B
Current Price:$79.55
Cap:$81.33B

Presented

Date10/25/2019
Price$107.19
Market Cap$126.13B
Ent Value$129.95B
P/E Ratio50.28x
Book Value$14.04
Div Yield0%
Shares O/S1,176.67M
Ave Daily Vol7,257,665
Short Int1.17%

Current

Price$79.55
Market Cap$81.33B
PayPal Holdings, Inc. engages in the development of technology platform for digital payments. Its solutions include PayPal, PayPal Credit, Braintree, Venmo, Xoom, and Paydiant products. It manages a two-sided proprietary global technology platform that links customers, which consist of both merchants and consumers, to facilitate the processing of payment transactions. It allows its customers to use their account for both purchase and paying for goods, as well as to transfer and withdraw funds. It enables consumers to exchange funds with merchants using funding sources, which include bank account, PayPal account balance, PayPal Credit account, credit and debit card or other stored value products. It offers consumers person-to-person payment solutions through its PayPal Website and mobile application, Venmo and Xoom. The company was founded in December 1998 and is headquartered in San Jose, CA.

PayPal Holdings Inc (PYPL) - Long

Publicly traded companies mentioned herein: Amazon.com Inc (AMZN), Apple Inc (AAPL), eBay Inc (EBAY), Mastercard Inc (MA), MercadoLibre Inc (MELI), PayPal Holdings Inc (PYPL), Uber Technologies Inc (UBER), Visa Inc (V)

Highlights

The presenter is long shares of Paypal (PYPL) at ~$106 per share and believes the company deserves a higher multiple based on its resilient earnings growth and ability to continue to ride on the coattails of e-commerce growth. He expects revenues to grow mid- to high-teens% over the next few years and earnings to grow 20%+. For investors willing to put up with some volatility over the next two years, he models ~25% upside to his ~$135 per share PT based on a 30x 2021 EPS multiple. 

In Q3’19, PYPL’s total payment volume (TPV) totalled $179B and active users came in at 295M, up 27% and 16%, respectively. According to the presenter, PYPL is one of the few large cap companies with this type of growth, which he expects to continue. 

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Idea Discussion

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