PayPal Holdings, Inc. (NASDAQ: PYPL) experienced a decline of 2.6% in its share price during trading on Wednesday following a downgrade from BNP Paribas Exane. The investment firm lowered its price target on PayPal’s stock from $71.00 to $69.00, maintaining a neutral rating. Shares traded as low as $60.41 before closing at $61.24. In total, approximately 24,331,510 shares changed hands, reflecting a significant increase of 95% over the average daily volume of 12,451,697 shares.
Several other analysts have shared insights on PayPal’s stock, contributing to a mixed outlook. For instance, Mizuho set a price target of $84.00 in a report dated October 30, 2023. Conversely, Jefferies Financial Group reduced its target from $75.00 to $60.00 with a “hold” recommendation on November 24, 2023. Citigroup upgraded the stock to a “hold” rating on October 23, 2023, while Dbs Bank adjusted its price objective down from $75.00 to $70.00 on November 13, 2023. Morgan Stanley reiterated a “negative” rating on October 29, 2023.
Currently, analysts have assigned a consensus rating of “Hold” to PayPal, with 15 analysts recommending a Buy, 19 a Hold, and 4 a Sell. The average target price stands at $81.67, according to data from MarketBeat.
Institutional Investors Adjust Their Stakes
Recent activity among institutional investors indicates a shift in sentiment towards PayPal. IFP Advisors Inc. increased its holdings by 3.9% in the third quarter, owning 49,166 shares valued at approximately $3,297,000 after acquiring an additional 1,833 shares. Similarly, Swiss Life Asset Management Ltd raised its stake by 7.0%, now holding 225,198 shares worth around $15,102,000.
Strategic Advocates LLC and CIBC Bancorp USA Inc. both entered new positions in PayPal, valued at approximately $38,000 and $11,109,000, respectively. Achmea Investment Management B.V. saw a notable increase in its position, growing by 127.9% to own 474,631 shares valued at about $31,828,000. Overall, hedge funds and institutional investors now control 68.32% of PayPal’s stock.
Recent Financial Results and Future Guidance
PayPal’s financial performance remains a focal point for investors. The company reported earnings per share (EPS) of $1.34 for the quarter ending on October 28, 2023, surpassing the consensus estimate of $1.20 by $0.14. The firm achieved a net margin of 14.96% and a return on equity of 25.64%, with quarterly revenue reaching $8.42 billion, exceeding expectations of $8.21 billion.
Looking ahead, PayPal has provided guidance for the fourth quarter of 2025, forecasting EPS between $1.270 and $1.310. The full-year guidance for 2025 is set between $5.350 and $5.390 EPS. Analysts predict that PayPal will report an average of $5.03 EPS for the current year.
In addition to its financial performance, PayPal announced a quarterly dividend of $0.14 per share, to be paid on December 10, 2023, to investors of record as of November 19, 2023. This dividend represents an annualized figure of $0.56, offering a yield of 0.9%. The current payout ratio stands at 11.22%.
PayPal Holdings, Inc. operates a digital payments technology platform that facilitates transactions for merchants and consumers globally. It connects users to various funding sources, enabling seamless online and in-person payments.
As PayPal navigates a complex financial landscape, its performance will remain under scrutiny from investors and analysts alike, particularly in light of recent market reactions and institutional movements.
