chameleonseye
Summary
- PayPal’s Q4 FY2023 results showed a slight decrease in growth but still beat consensus estimates, reflecting solid financial results amidst organizational changes.
- PYPL’s strategic priorities include accelerating growth in branded checkout, driving profitable growth in PSP services, and focusing on small business solutions.
- The Company’s opportunity to expand its ecosystem and become a data-driven ‘super-app’ could fuel growth acceleration in the medium term.
- PayPal’s revenue streams appear robust, with a focus on qualitative growth expected to expand business margins and bolster free cash flow generation in the future.
- Under conservative assumptions, my calculations lead me to a price objective of $73.45 by the end of 2025, which is 24.7% above today’s price. So PYPL is still a “Buy” for me despite many risks surrounding the company.
- I am Danil Sereda, chief investment officer at a family office. I analyze information that ordinary retail investors do not have access to, and lead the investing group Beyond the Wall Investing.
Intro & Thesis
I initiated coverage of PayPal Holdings, Inc. (NASDAQ:PYPL) stock in May 2023, initially giving them a “Hold” rating, citing slowing business growth rates and still expensive valuation at the time. However, in late November 2023, I upgraded the stock to “Buy” seeing a jump in PayPal’s fair value. Since then, PayPal has seen a 17% surge before experiencing an 11% decline after the latest report for Q4 FY2023.
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