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Visa vs. PayPal: Which Payments Stock Wins the Upside Race?
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Key Takeaways
Visa posted strong growth in payments, cross-border activity and commercial transactions.
V expanded AI commerce, stablecoin programs and Visa Direct to drive transaction growth.
PayPal grew Venmo, BNPL and checkout volumes, but Visa shows higher implied upside.
Visa Inc. (V - Free Report) and PayPal Holdings, Inc. (PYPL - Free Report) are leading players in the global digital payments industry, benefiting from the ongoing shift toward cashless transactions, e-commerce growth and increasing digital commerce activity worldwide. Both compete in online payments and checkout solutions while serving consumers and merchants across a rapidly evolving payments ecosystem.
While Visa operates the world's largest payment network, PayPal has built a strong presence through its digital wallet and online payments platform. Their distinct business models and strategic priorities highlight different approaches to capturing opportunities across the expanding digital payments landscape.
Let’s dive deep and closely compare the fundamentals of the two stocks to determine which stock offers greater upside right now.
The Case for Visa
Visa's core payments business continues to deliver steady growth across consumer, commercial and cross-border transactions. In the second quarter of fiscal 2026, payments volume and processed transactions each increased 9% year over year, while commercial payments volume rose 11%. Cross-border activity also remained healthy, supported by resilient spending trends and expanding digital commerce. With cash displacement continuing globally, Visa remains well positioned to benefit from rising transaction volumes across its network.
The company is also gaining traction in money movement and commercial payments, two areas that extend beyond traditional card transactions. Revenues from commercial and money movement solutions increased 24% year over year, while Visa Direct transactions grew 23% in the second quarter of fiscal 2026. Visa Direct’s network now reaches more than 18 billion endpoints worldwide, supporting use cases such as remittances, business payments and real-time transfers. Another key growth driver is V's value-added services business. Revenues from these offerings increased 27% year over year in the fiscal second quarter and now represents roughly 30% of net revenues.
It beat earnings in each of the past four quarters, with an average surprise of 3.2%.
It is investing heavily in AI-driven payment technologies. The company believes agentic commerce can expand digital payment activity and create new transaction opportunities across consumer and business payments. Recent initiatives, including Intelligent Commerce Connect and Visa CLI, are designed to support AI-enabled transactions, while Visa's tokenization, security and fraud-prevention capabilities strengthen its position as commerce becomes increasingly automated.
Visa is also expanding its role in the stablecoin ecosystem by serving as a bridge between blockchain-based assets and traditional payment networks. The company now supports more than 160 stablecoin-linked card programs globally, allowing users to spend stablecoin balances anywhere Visa is accepted. Stablecoin payment volume associated with these programs surged nearly 200% year over year in the second quarter of fiscal 2026. V is also broadening its stablecoin settlement capabilities across multiple blockchains, with annualized stablecoin settlement volume reaching approximately $7 billion. As stablecoins gain wider adoption for payments, remittances and settlements, these initiatives could increase transaction activity across its network.
Additionally, V’s strong cash position enables substantial share buybacks and dividend payouts. It supports inorganic growth and financial stability. With $12.4 billion in cash, the company maintains a solid capital position. Visa returned $9.2 billion to its shareholders through share repurchases and dividends in the fiscal second quarter.
The Case for PayPal
PayPal is strengthening engagement across its merchant and consumer ecosystem through improvements in checkout experiences and payment solutions. Total payment volume rose 11% year over year in the first quarter of 2026, supported by healthy transaction activity and improving performance in branded checkout. Pay with Venmo and buy now, pay later continued to outperform, with payment volumes rising 34% and 23%, respectively. Meanwhile, Venmo and Enterprise Payments delivered mid-teens growth.
Venmo and consumer financial services remain key pillars of PYPL's growth strategy. The company is expanding beyond payments by offering a broader set of financial products and services that encourage deeper customer engagement. In March 2026, Venmo announced a major expansion, extending its peer-to-peer payment experience to users worldwide across 90 markets. Increased adoption of Venmo, along with growing usage of digital financial tools, is helping expand activity across PayPal's ecosystem. It beat earnings estimates in three of the past four quarters and missed once, with an average surprise of 10.3%.
PayPal Holdings, Inc. Price, Consensus and EPS Surprise
PayPal is advancing a multi-year transformation effort focused on simplifying its operating structure and improving efficiency. The company expects to generate more than $1.5 billion in savings over the next two to three years through organizational realignment, the elimination of duplicated work and layers, and broader use of AI and automation. These efforts are designed to streamline operations and support investment in strategic priorities.
The company is deploying AI across technology development, customer support, operations and risk management to improve productivity and customer experiences. It is also expanding into agentic commerce through partnerships with OpenAI, Perplexity, Anthropic, Microsoft and Salesforce. These initiatives are designed to enable AI agents to discover products, make purchasing decisions and complete transactions using PYPL's payment infrastructure, extending the company's role within the evolving digital commerce ecosystem.
It is also strengthening its presence in digital assets through PayPal USD (“PYUSD”), its U.S. dollar-backed stablecoin that is increasingly being integrated across the company's payments ecosystem. The stablecoin supports peer-to-peer transfers, merchant transactions and cross-border payment use cases. The company recently expanded its availability to 70 markets globally. The broader rollout is helping extend PYUSD's reach as PYPL works to embed stablecoin capabilities across digital commerce.
The company exited the first quarter of 2026 with cash and cash equivalents of $7 billion. It returned $1.5 billion to its shareholders by repurchasing shares of common stock in the first quarter of 2026.
How Do the Zacks Consensus Estimate Compare for V & PYPL?
The Zacks Consensus Estimate for V’s bottom line is comparably favorable at this stage. The consensus estimate for V’s fiscal 2026 earnings indicates a 14.1% increase from a year ago, while the same for revenues suggests 13.4% growth. It has witnessed 14 positive earnings estimate revisions over the past 60 days, against no downward revisions.
On the other hand, the Zacks Consensus Estimate for PYPL’s 2026 EPS indicates a 0.2% year-over-year decline, and the same for revenues signals a 3.3% rise. It has witnessed six upward earnings estimate revisions over the past 60 days and six downward movements.
Valuation: V vs. PYPL
Coming to the valuation story, it seems that investors are willing to pay a premium for Visa compared to PayPal. This is reflected in V’s forward 12-month price/earnings (P/E) of 22.63X compared with PYPL’s 7.70X. Both are currently trading below their three-year median P/E value.
Image Source: Zacks Investment Research
Price Target
Visa currently trades below its average analyst price target of $400.46, implying a 24.2% potential upside from current levels. PayPal also trades below its average analyst price target of $48.30, implying an 16.3% potential upside from current levels.
Price Performance Comparison
Over the past three months, shares of Visa have outperformed PayPal and the industry. Meanwhile, the S&P 500 has increased 10.7% during this time.
Price Performance – V, PYPL, Industry & S&P 500
Image Source: Zacks Investment Research
Conclusion
Both Visa and PayPal are benefiting from the long-term shift toward digital payments, but their current trajectories differ. PayPal is making progress through checkout improvements, Venmo growth, stablecoin expansion and ongoing efficiency initiatives.
Visa, however, appears to have the stronger investment case at this stage. Its diversified growth drivers, including cross-border payments, money movement, value-added services, AI-powered commerce and stablecoins, are supporting robust earnings growth. Combined with favorable estimate revisions and higher implied upside, Visa stands out as the more attractive stock right now.
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Image: Bigstock
Visa vs. PayPal: Which Payments Stock Wins the Upside Race?
Key Takeaways
Visa Inc. (V - Free Report) and PayPal Holdings, Inc. (PYPL - Free Report) are leading players in the global digital payments industry, benefiting from the ongoing shift toward cashless transactions, e-commerce growth and increasing digital commerce activity worldwide. Both compete in online payments and checkout solutions while serving consumers and merchants across a rapidly evolving payments ecosystem.
While Visa operates the world's largest payment network, PayPal has built a strong presence through its digital wallet and online payments platform. Their distinct business models and strategic priorities highlight different approaches to capturing opportunities across the expanding digital payments landscape.
Let’s dive deep and closely compare the fundamentals of the two stocks to determine which stock offers greater upside right now.
The Case for Visa
Visa's core payments business continues to deliver steady growth across consumer, commercial and cross-border transactions. In the second quarter of fiscal 2026, payments volume and processed transactions each increased 9% year over year, while commercial payments volume rose 11%. Cross-border activity also remained healthy, supported by resilient spending trends and expanding digital commerce. With cash displacement continuing globally, Visa remains well positioned to benefit from rising transaction volumes across its network.
The company is also gaining traction in money movement and commercial payments, two areas that extend beyond traditional card transactions. Revenues from commercial and money movement solutions increased 24% year over year, while Visa Direct transactions grew 23% in the second quarter of fiscal 2026. Visa Direct’s network now reaches more than 18 billion endpoints worldwide, supporting use cases such as remittances, business payments and real-time transfers. Another key growth driver is V's value-added services business. Revenues from these offerings increased 27% year over year in the fiscal second quarter and now represents roughly 30% of net revenues.
It beat earnings in each of the past four quarters, with an average surprise of 3.2%.
Visa Inc. Price, Consensus and EPS Surprise
Visa Inc. price-consensus-eps-surprise-chart | Visa Inc. Quote
It is investing heavily in AI-driven payment technologies. The company believes agentic commerce can expand digital payment activity and create new transaction opportunities across consumer and business payments. Recent initiatives, including Intelligent Commerce Connect and Visa CLI, are designed to support AI-enabled transactions, while Visa's tokenization, security and fraud-prevention capabilities strengthen its position as commerce becomes increasingly automated.
Visa is also expanding its role in the stablecoin ecosystem by serving as a bridge between blockchain-based assets and traditional payment networks. The company now supports more than 160 stablecoin-linked card programs globally, allowing users to spend stablecoin balances anywhere Visa is accepted. Stablecoin payment volume associated with these programs surged nearly 200% year over year in the second quarter of fiscal 2026. V is also broadening its stablecoin settlement capabilities across multiple blockchains, with annualized stablecoin settlement volume reaching approximately $7 billion. As stablecoins gain wider adoption for payments, remittances and settlements, these initiatives could increase transaction activity across its network.
Additionally, V’s strong cash position enables substantial share buybacks and dividend payouts. It supports inorganic growth and financial stability. With $12.4 billion in cash, the company maintains a solid capital position. Visa returned $9.2 billion to its shareholders through share repurchases and dividends in the fiscal second quarter.
The Case for PayPal
PayPal is strengthening engagement across its merchant and consumer ecosystem through improvements in checkout experiences and payment solutions. Total payment volume rose 11% year over year in the first quarter of 2026, supported by healthy transaction activity and improving performance in branded checkout. Pay with Venmo and buy now, pay later continued to outperform, with payment volumes rising 34% and 23%, respectively. Meanwhile, Venmo and Enterprise Payments delivered mid-teens growth.
Venmo and consumer financial services remain key pillars of PYPL's growth strategy. The company is expanding beyond payments by offering a broader set of financial products and services that encourage deeper customer engagement. In March 2026, Venmo announced a major expansion, extending its peer-to-peer payment experience to users worldwide across 90 markets. Increased adoption of Venmo, along with growing usage of digital financial tools, is helping expand activity across PayPal's ecosystem. It beat earnings estimates in three of the past four quarters and missed once, with an average surprise of 10.3%.
PayPal Holdings, Inc. Price, Consensus and EPS Surprise
PayPal Holdings, Inc. price-consensus-eps-surprise-chart | PayPal Holdings, Inc. Quote
PayPal is advancing a multi-year transformation effort focused on simplifying its operating structure and improving efficiency. The company expects to generate more than $1.5 billion in savings over the next two to three years through organizational realignment, the elimination of duplicated work and layers, and broader use of AI and automation. These efforts are designed to streamline operations and support investment in strategic priorities.
The company is deploying AI across technology development, customer support, operations and risk management to improve productivity and customer experiences. It is also expanding into agentic commerce through partnerships with OpenAI, Perplexity, Anthropic, Microsoft and Salesforce. These initiatives are designed to enable AI agents to discover products, make purchasing decisions and complete transactions using PYPL's payment infrastructure, extending the company's role within the evolving digital commerce ecosystem.
It is also strengthening its presence in digital assets through PayPal USD (“PYUSD”), its U.S. dollar-backed stablecoin that is increasingly being integrated across the company's payments ecosystem. The stablecoin supports peer-to-peer transfers, merchant transactions and cross-border payment use cases. The company recently expanded its availability to 70 markets globally. The broader rollout is helping extend PYUSD's reach as PYPL works to embed stablecoin capabilities across digital commerce.
The company exited the first quarter of 2026 with cash and cash equivalents of $7 billion. It returned $1.5 billion to its shareholders by repurchasing shares of common stock in the first quarter of 2026.
How Do the Zacks Consensus Estimate Compare for V & PYPL?
The Zacks Consensus Estimate for V’s bottom line is comparably favorable at this stage. The consensus estimate for V’s fiscal 2026 earnings indicates a 14.1% increase from a year ago, while the same for revenues suggests 13.4% growth. It has witnessed 14 positive earnings estimate revisions over the past 60 days, against no downward revisions.
On the other hand, the Zacks Consensus Estimate for PYPL’s 2026 EPS indicates a 0.2% year-over-year decline, and the same for revenues signals a 3.3% rise. It has witnessed six upward earnings estimate revisions over the past 60 days and six downward movements.
Valuation: V vs. PYPL
Coming to the valuation story, it seems that investors are willing to pay a premium for Visa compared to PayPal. This is reflected in V’s forward 12-month price/earnings (P/E) of 22.63X compared with PYPL’s 7.70X. Both are currently trading below their three-year median P/E value.
Image Source: Zacks Investment Research
Price Target
Visa currently trades below its average analyst price target of $400.46, implying a 24.2% potential upside from current levels. PayPal also trades below its average analyst price target of $48.30, implying an 16.3% potential upside from current levels.
Price Performance Comparison
Over the past three months, shares of Visa have outperformed PayPal and the industry. Meanwhile, the S&P 500 has increased 10.7% during this time.
Price Performance – V, PYPL, Industry & S&P 500
Image Source: Zacks Investment Research
Conclusion
Both Visa and PayPal are benefiting from the long-term shift toward digital payments, but their current trajectories differ. PayPal is making progress through checkout improvements, Venmo growth, stablecoin expansion and ongoing efficiency initiatives.
Visa, however, appears to have the stronger investment case at this stage. Its diversified growth drivers, including cross-border payments, money movement, value-added services, AI-powered commerce and stablecoins, are supporting robust earnings growth. Combined with favorable estimate revisions and higher implied upside, Visa stands out as the more attractive stock right now.
While V currently carries a Zacks Rank #2 (Buy), PYPL has a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.