Overview
- On December 18, Morgan Stanley cut PayPal to Underweight and lowered its price target to $51, citing difficult, time‑consuming checkout upgrades, weak Venmo monetization, share loss, and take‑rate pressure that could slow dollar growth through 2028.
- Mizuho on December 22 trimmed its target to $75 but kept an Outperform rating after factoring management’s December 3 commentary, reducing Q4 branded checkout growth to about 1% from roughly 4% and Pay with Venmo growth to 40% from 45%, with transaction margin dollars now modeled at 2%.
- PayPal’s latest quarter featured an EPS beat at $1.20 versus $1.07 but a revenue miss at $7.85 billion versus $7.89 billion, and guidance for low single‑digit Q4 revenue growth versus roughly 5.4% expected, a combination that sent shares down as much as 7%.
- Consensus as of December 26 shows 37% Buy, 52% Hold, and 11% Sell ratings, with a median price target of $75 implying about 25% upside and a wide range from substantial potential upside to limited downside.
- Value‑oriented commentary highlights modest growth, strong margins, and potential from Venmo, branded checkout enhancements, and a prospective bank charter for small‑business lending, though the timing and impact remain uncertain.