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PayPal vs. Upstart: Which Fintech Stock is the Better Buy Now?
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Key Takeaways
PayPal's Q4 revenue rise 3.7% and TPV increase 8.4%, but branded checkout TPV rose just 1%.
PayPal expands Venmo globally and adds AI partnerships, but sees slight TM$ and EPS decline in 2026.
Upstart revenues jumped 35% in Q4 and 64% in 2025, with auto and home originations surging fast.
The fintech sector is surging with steady momentum, driven by companies such as PayPal (PYPL - Free Report) and Upstart Holdings (UPST - Free Report) , which are advancing digital payments and AI-enabled lending. Investors seeking exposure to top fintech stocks will find both names intriguing, each excelling in its unique domain.
PayPal, the payments powerhouse, dominates digital transactions with Venmo’s social buzz, new payment features and strategic partnerships that keep its ecosystem expanding relentlessly. On the other hand, Upstart, the AI lending disruptor, counters with solid revenue growth, powering loans through smart algorithms while expanding into auto and home financing territories. Yet, both face hurdles, intense competition and foreign exchange fluctuations for PayPal and credit sensitivity and volatility for Upstart.
Let’s dive deep and closely compare the fundamentals of the two stocks to determine which stock is more attractive now.
The Case for PayPal
PayPal is executing on four growth pillars: winning checkout, scaling omni and growing Venmo, driving payment services profitability and scaling its next-gen growth vectors. PayPal delivered decent fourth-quarter results, with revenues rising 3.7% year over year and Total Payment Volume (“TPV”) climbing 8.4%.
Venmo, a money movement platform, is especially popular among young, digitally native consumers. In March 2026, Venmo announced a major expansion, extending its peer-to-peer payment experience to users worldwide. Venmo users can now send and receive money to/from hundreds of millions of PayPal users across 90 markets. This marks Venmo's largest market expansion since the app’s launch.
PayPal is advancing AI-powered e-commerce via “agentic commerce,” where AI agents assist shoppers in discovering, comparing and purchasing products. Through partnerships with AI platforms, like Microsoft (powering Copilot Checkout), Perplexity AI (enabling purchases in Perplexity Pro), OpenAI (supporting agentic shopping in ChatGPT) and Google Cloud (for AI-driven fraud detection), the company is creating more scalable, secure and smart shopping experiences for merchants and consumers.
However, PayPal faces macroeconomic headwinds and operates in a highly competitive global payments industry. Its nature of business makes it vulnerable to foreign exchange fluctuations. The company also issued weaker-than-expected 2026 guidance, where TM$ is expected to decline slightly alongside an adjusted EPS range of a low single-digit decline to a slightly positive gain.
In the fourth quarter of 2025, PayPal’s online branded checkout TPV grew only 1% on a currency-neutral basis, down from 5% in the previous quarter. The company highlighted U.S. retail weakness, international headwinds like Germany macro softness, competition and slowdown in high-growth verticals leading to this de-growth.
The Case for Upstart
Upstart is a leading artificial intelligence (AI) lending marketplace that connects consumers to more than 100 banks and credit unions via AI models for underwriting. The company makes money through platform/referral fees from its lending partners, loan servicing charges, and proceeds from selling loans or securitizing them. In the fourth quarter of 2025, the company saw revenues surge 35% year over year, while for full-year 2025, it increased 64%.
Upstart has expanded beyond its core personal loan business into areas like auto lending, home equity lines of credit (HELOCs) and small-dollar loans. While these emerging segments are still smaller than personal loans, they're expanding quickly. In 2025, its auto and home originations both grew 5x year over year and accelerated even further in the fourth quarter of 2025. In the quarter, its auto originations were up 56% sequentially and 340% year over year, while home originations were up 70% sequentially and 350% year over year.
In the coming quarters, management expects AI-powered lending led by Upstart to rapidly gain market share across these huge unsecured home and auto segments, as well as additional lending categories in the near future. The company has been building the teams, the skills and the technologies to deploy AI in lending for more than a dozen years and believes the company is peerless in this regard.
Upstart enables lending partners to originate credit through its AI lending marketplace. It continues to expand its credit union footprint, with DuPage Credit Union selecting its platform for personal lending. For Upstart, this directly supports higher transaction flow on its marketplace, reinforcing its revenue model tied to loan originations. Similarly, last month, Upstart also partnered with Harborstone Credit Union, enabling the credit union to offer personal lending. As of Dec. 31, 2025, Upstart had more than 100 lending partners participating on its marketplace.
Despite exposure to credit-sensitive borrowers and volatility in AI-driven models, Upstart’s leading AI lending marketplace, diversified products and strategic partnerships make it a reliable choice for investors seeking fintech stocks with strong growth prospects.
How Do Estimates Compare for PayPal and Upstart?
The Zacks Consensus Estimate for PayPal’s 2026 sales implies 3.1% year-over-year growth, while EPS remained unchanged. EPS estimates for 2026 have been downward over the past two months.
For PayPal:
Image Source: Zacks Investment Research
The Zacks Consensus Estimate for Upstart’s 2026 sales implies year-over-year growth of 34.2%, while the 2026 EPS indicates 35.1% growth. What is also encouraging is that EPS estimates for 2026 have been trending northward over the past month.
For Upstart:
Image Source: Zacks Investment Research
Price Performance: PYPL vs. UPST
Over the past month, both PYPL and UPST shares have increased 6.8% and 14.9%, respectively, outperforming the S&P 500 composite.
Image Source: Zacks Investment Research
Valuation: PYPL vs. UPST
In terms of forward 12-month Price/Sales (P/S), PYPL stock is trading at 1.25X, below its three-year median of 2.06X, while Upstart is currently trading at 1.89X, which is also below its three-year median of 4.09X.
Image Source: Zacks Investment Research
Conclusion
Both PayPal and Upstart are notable players in the fintech landscape, yet they represent very different kinds of opportunities. PayPal benefits from its large scale, strong user engagement through Venmo, broad product suite and strategic partnerships. However, it faces macroeconomic headwinds and intense competition, while its weaker 2026 guidance remains a concern.
In contrast, Upstart’s AI-driven lending platform is innovative and growing rapidly, yet its heavy exposure to credit-sensitive borrowers and volatility in AI-driven models remains a concern. Upstart is smartly expanding into new credit categories via enhanced AI.
With strong revenue growth, strategic partnerships and AI automation powering its edge, Upstart offers the most compelling near-term upside among fintechs for investors eyeing sustained growth.
Currently, PYPL carries a Zacks Rank #4 (Sell), while UPST has a Zacks Rank #3 (Hold).
View the Zacks #1 Rank List
Image: Bigstock
PayPal vs. Upstart: Which Fintech Stock is the Better Buy Now?
Key Takeaways
The fintech sector is surging with steady momentum, driven by companies such as PayPal (PYPL - Free Report) and Upstart Holdings (UPST - Free Report) , which are advancing digital payments and AI-enabled lending. Investors seeking exposure to top fintech stocks will find both names intriguing, each excelling in its unique domain.
PayPal, the payments powerhouse, dominates digital transactions with Venmo’s social buzz, new payment features and strategic partnerships that keep its ecosystem expanding relentlessly. On the other hand, Upstart, the AI lending disruptor, counters with solid revenue growth, powering loans through smart algorithms while expanding into auto and home financing territories. Yet, both face hurdles, intense competition and foreign exchange fluctuations for PayPal and credit sensitivity and volatility for Upstart.
Let’s dive deep and closely compare the fundamentals of the two stocks to determine which stock is more attractive now.
The Case for PayPal
PayPal is executing on four growth pillars: winning checkout, scaling omni and growing Venmo, driving payment services profitability and scaling its next-gen growth vectors. PayPal delivered decent fourth-quarter results, with revenues rising 3.7% year over year and Total Payment Volume (“TPV”) climbing 8.4%.
Venmo, a money movement platform, is especially popular among young, digitally native consumers. In March 2026, Venmo announced a major expansion, extending its peer-to-peer payment experience to users worldwide. Venmo users can now send and receive money to/from hundreds of millions of PayPal users across 90 markets. This marks Venmo's largest market expansion since the app’s launch.
PayPal is advancing AI-powered e-commerce via “agentic commerce,” where AI agents assist shoppers in discovering, comparing and purchasing products. Through partnerships with AI platforms, like Microsoft (powering Copilot Checkout), Perplexity AI (enabling purchases in Perplexity Pro), OpenAI (supporting agentic shopping in ChatGPT) and Google Cloud (for AI-driven fraud detection), the company is creating more scalable, secure and smart shopping experiences for merchants and consumers.
However, PayPal faces macroeconomic headwinds and operates in a highly competitive global payments industry. Its nature of business makes it vulnerable to foreign exchange fluctuations. The company also issued weaker-than-expected 2026 guidance, where TM$ is expected to decline slightly alongside an adjusted EPS range of a low single-digit decline to a slightly positive gain.
In the fourth quarter of 2025, PayPal’s online branded checkout TPV grew only 1% on a currency-neutral basis, down from 5% in the previous quarter. The company highlighted U.S. retail weakness, international headwinds like Germany macro softness, competition and slowdown in high-growth verticals leading to this de-growth.
The Case for Upstart
Upstart is a leading artificial intelligence (AI) lending marketplace that connects consumers to more than 100 banks and credit unions via AI models for underwriting. The company makes money through platform/referral fees from its lending partners, loan servicing charges, and proceeds from selling loans or securitizing them. In the fourth quarter of 2025, the company saw revenues surge 35% year over year, while for full-year 2025, it increased 64%.
Upstart has expanded beyond its core personal loan business into areas like auto lending, home equity lines of credit (HELOCs) and small-dollar loans. While these emerging segments are still smaller than personal loans, they're expanding quickly. In 2025, its auto and home originations both grew 5x year over year and accelerated even further in the fourth quarter of 2025. In the quarter, its auto originations were up 56% sequentially and 340% year over year, while home originations were up 70% sequentially and 350% year over year.
In the coming quarters, management expects AI-powered lending led by Upstart to rapidly gain market share across these huge unsecured home and auto segments, as well as additional lending categories in the near future. The company has been building the teams, the skills and the technologies to deploy AI in lending for more than a dozen years and believes the company is peerless in this regard.
Upstart enables lending partners to originate credit through its AI lending marketplace. It continues to expand its credit union footprint, with DuPage Credit Union selecting its platform for personal lending. For Upstart, this directly supports higher transaction flow on its marketplace, reinforcing its revenue model tied to loan originations. Similarly, last month, Upstart also partnered with Harborstone Credit Union, enabling the credit union to offer personal lending. As of Dec. 31, 2025, Upstart had more than 100 lending partners participating on its marketplace.
Despite exposure to credit-sensitive borrowers and volatility in AI-driven models, Upstart’s leading AI lending marketplace, diversified products and strategic partnerships make it a reliable choice for investors seeking fintech stocks with strong growth prospects.
How Do Estimates Compare for PayPal and Upstart?
The Zacks Consensus Estimate for PayPal’s 2026 sales implies 3.1% year-over-year growth, while EPS remained unchanged. EPS estimates for 2026 have been downward over the past two months.
For PayPal:
Image Source: Zacks Investment Research
The Zacks Consensus Estimate for Upstart’s 2026 sales implies year-over-year growth of 34.2%, while the 2026 EPS indicates 35.1% growth. What is also encouraging is that EPS estimates for 2026 have been trending northward over the past month.
For Upstart:
Image Source: Zacks Investment Research
Price Performance: PYPL vs. UPST
Over the past month, both PYPL and UPST shares have increased 6.8% and 14.9%, respectively, outperforming the S&P 500 composite.
Image Source: Zacks Investment Research
Valuation: PYPL vs. UPST
In terms of forward 12-month Price/Sales (P/S), PYPL stock is trading at 1.25X, below its three-year median of 2.06X, while Upstart is currently trading at 1.89X, which is also below its three-year median of 4.09X.
Image Source: Zacks Investment Research
Conclusion
Both PayPal and Upstart are notable players in the fintech landscape, yet they represent very different kinds of opportunities. PayPal benefits from its large scale, strong user engagement through Venmo, broad product suite and strategic partnerships. However, it faces macroeconomic headwinds and intense competition, while its weaker 2026 guidance remains a concern.
In contrast, Upstart’s AI-driven lending platform is innovative and growing rapidly, yet its heavy exposure to credit-sensitive borrowers and volatility in AI-driven models remains a concern. Upstart is smartly expanding into new credit categories via enhanced AI.
With strong revenue growth, strategic partnerships and AI automation powering its edge, Upstart offers the most compelling near-term upside among fintechs for investors eyeing sustained growth.
Currently, PYPL carries a Zacks Rank #4 (Sell), while UPST has a Zacks Rank #3 (Hold).
You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.