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Paypal (PYPL) Stock Sinks As Market Gains: What You Should Know

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Paypal (PYPL - Free Report) closed the most recent trading day at $72.37, moving -0.73% from the previous trading session. This move lagged the S&P 500's daily gain of 2.45%. Meanwhile, the Dow gained 2.15%, and the Nasdaq, a tech-heavy index, added 0.18%.

Prior to today's trading, shares of the technology platform and digital payments company had lost 10.2% over the past month. This has lagged the Computer and Technology sector's loss of 4.95% and the S&P 500's loss of 5.71% in that time.

Investors will be hoping for strength from Paypal as it approaches its next earnings release. In that report, analysts expect Paypal to post earnings of $0.87 per share. This would mark a year-over-year decline of 24.35%. Meanwhile, our latest consensus estimate is calling for revenue of $6.82 billion, up 9.28% from the prior-year quarter.

Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $3.95 per share and revenue of $28.26 billion. These totals would mark changes of -14.13% and +11.4%, respectively, from last year.

It is also important to note the recent changes to analyst estimates for Paypal. These recent revisions tend to reflect the evolving nature of short-term business trends. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.

Based on our research, we believe these estimate revisions are directly related to near-team stock moves. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.

The Zacks Rank system ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. The Zacks Consensus EPS estimate has moved 2.07% lower within the past month. Paypal is currently a Zacks Rank #5 (Strong Sell).

Investors should also note Paypal's current valuation metrics, including its Forward P/E ratio of 18.45. This valuation marks a discount compared to its industry's average Forward P/E of 40.11.

Investors should also note that PYPL has a PEG ratio of 1.06 right now. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. The Internet - Software industry currently had an average PEG ratio of 2.22 as of yesterday's close.

The Internet - Software industry is part of the Computer and Technology sector. This industry currently has a Zacks Industry Rank of 166, which puts it in the bottom 35% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our individual industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Make sure to utilize Zacks.com to follow all of these stock-moving metrics, and more, in the coming trading sessions.


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