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PayPal's (PYPL) Q2 Earnings to Benefit via Portfolio Strength

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PayPal Holdings, Inc. (PYPL - Free Report) is slated to report second-quarter 2023 results on Aug 2.

The company’s robust services have enabled it to maintain a deep and trusted relationship with merchants and consumers. Its two-sided platform helps develop direct financial relationships with customers and merchants.

The Total Payment Volume (TPV) for the second quarter is anticipated to reflect the impacts of all these factors. TPV is a key growth metric for PayPal’s top line.

In the last reported quarter, TPV improved by 10% year over year on a spot rate basis and 12% on a currency-neutral basis to $354.5 billion.

For second-quarter 2023, the Zacks Consensus Estimate for TPV is pegged at $370.02 billion, suggesting growth of 8.9% on a year-over-year basis.

Click here to know how the company’s overall second-quarter performance is expected to have been.

PayPal Holdings, Inc. Price and EPS Surprise

 

PayPal Holdings, Inc. Price and EPS Surprise

PayPal Holdings, Inc. price-eps-surprise | PayPal Holdings, Inc. Quote

 

Portfolio Strength: A Key Catalyst

PayPal’s continuous efforts toward strengthening the services portfolio are likely to have aided in gaining traction among various customers in the second quarter.

In the said quarter, the company strengthened its payment solution offerings for small businesses by adding new features. The features allow small businesses to accept payments made through PayPal, credit and debit cards, digital wallets, Venmo, PayPal Pay Later and Apple Pay.

PayPal introduced Tap to Pay on Android for Venmo and Zettle users to empower small businesses with seamless payment options.

This apart, the robust performance of Venmo is likely to have continued to contribute well. The company’s TPV is likely to have benefited from Venmo’s strengthening monetization efforts.

PayPal introduced the Venmo Teen Account in the second quarter in a bid to allow parents and legal guardians to open a Venmo account for their teenagers between the ages of 13 and 17. This move is expected to have driven PayPal’s momentum among teenagers.

Additionally, the company’s strengthening cryptocurrency efforts, along with the Venmo integration and the expanding global footprint of its cryptocurrency service, are expected to have contributed well.

The solid momentum in the buy now, pay later solution of PayPal is likely to have benefited the quarterly performance.

Zacks Rank & Stocks to Consider

Currently, PayPal carries a Zacks Rank #3 (Hold).

Some better-ranked stocks in the broader technology sector are Salesforce (CRM - Free Report) , AvidXchange (AVDX - Free Report) and Akamai Technologies (AKAM - Free Report) . Salesforce and AvidXchange each sport a Zacks Rank #1 (Strong Buy) and Akamai Technologies carries a Zacks Rank #2 (Buy).

You can see the complete list of today’s Zacks #1 Rank stocks here.

Salesforce shares have gained 70.7% in the year-to-date period. The long-term earnings growth rate for CRM is currently projected at 19.25%.

AvidXchange shares have increased 21.1% in the year-to-date period. The long-term earnings growth rate for AVDX is currently projected at 22.90%.

Akamai shares have gained 9.5% in the year-to-date period. The long-term earnings growth rate for AKAM is currently projected at 10%.

Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.

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