Paypal (PYPL - Free Report) closed at $104.69 in the latest trading session, marking a -0.51% move from the prior day. This change lagged the S&P 500's 0.22% gain on the day. Meanwhile, the Dow gained 0.15%, and the Nasdaq, a tech-heavy index, added 0.6%.
Prior to today's trading, shares of the technology platform and digital payments company had gained 9.01% over the past month. This has outpaced the Computer and Technology sector's gain of 4.32% and the S&P 500's gain of 2.39% in that time.
PYPL will be looking to display strength as it nears its next earnings release. In that report, analysts expect PYPL to post earnings of $0.67 per share. This would mark year-over-year growth of 17.54%. Meanwhile, our latest consensus estimate is calling for revenue of $4.12 billion, up 11.85% from the prior-year quarter.
Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $2.88 per share and revenue of $18 billion. These totals would mark changes of +19.01% and +16.48%, respectively, from last year.
Any recent changes to analyst estimates for PYPL should also be noted by investors. Recent revisions tend to reflect the latest near-term business trends. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.
Research indicates that these estimate revisions are directly correlated with near-term share price momentum. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.
Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. The Zacks Consensus EPS estimate has moved 0.19% higher within the past month. PYPL currently has a Zacks Rank of #2 (Buy).
In terms of valuation, PYPL is currently trading at a Forward P/E ratio of 36.55. Its industry sports an average Forward P/E of 56.49, so we one might conclude that PYPL is trading at a discount comparatively.
Also, we should mention that PYPL has a PEG ratio of 2.04. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. The Internet - Software industry currently had an average PEG ratio of 3.14 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 55, which puts it in the top 22% of all 250+ industries.
The Zacks Industry Rank includes is listed in order from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
You can find more information on all of these metrics, and much more, on Zacks.com.