PayPal (NASDAQ:PYPL) Shares Down 2.8% on Analyst Downgrade

Key Points

• PayPal shares fell by 2.8% after Sanford C. Bernstein revised the price target down from $85.00 to $76.00, impacting trading volumes significantly.
• Despite the downgrade, there remains a consensus among analysts with sixteen maintaining a Buy rating and a target price averaging $83.18.
• Recent insider trading included the sale of over 15,000 shares by executives, suggesting possible concerns among company leaders about future stock performance.

PayPal Holdings, Inc. (NASDAQ:PYPL - Get Free Report) shares dropped 2.8% during trading on Wednesday after Sanford C. Bernstein lowered their price target on the stock from $85.00 to $76.00. The stock traded as low as $67.91 and last traded at $68.07. Approximately 8,140,847 shares changed hands during mid-day trading, a decline of 30% from the average daily volume of 11,582,990 shares. The stock had previously closed at $70.05.

A number of other equities analysts also recently commented on PYPL. Canaccord Genuity Group restated a "buy" rating and set a $96.00 price objective on shares of PayPal in a research note on Wednesday, July 30th. Citigroup reiterated a "buy" rating on shares of PayPal in a research note on Tuesday, July 29th. The Goldman Sachs Group set a $70.00 target price on shares of PayPal and gave the company a "sell" rating in a research note on Monday, October 13th. Barclays reiterated an "overweight" rating on shares of PayPal in a research note on Tuesday, July 29th. Finally, Seaport Res Ptn upgraded shares of PayPal from a "strong sell" rating to a "hold" rating in a research note on Monday, July 14th. Sixteen research analysts have rated the stock with a Buy rating, thirteen have issued a Hold rating and three have issued a Sell rating to the company. Based on data from MarketBeat.com, PayPal presently has a consensus rating of "Hold" and a consensus price target of $83.18.

Insiders Place Their Bets

In related news, CAO Chris Natali sold 7,102 shares of the stock in a transaction that occurred on Thursday, July 31st. The stock was sold at an average price of $69.35, for a total transaction of $492,523.70. The sale was disclosed in a filing with the SEC, which is accessible through this link. Also, EVP Diego Scotti sold 3,838 shares of the stock in a transaction that occurred on Thursday, July 31st. The stock was sold at an average price of $69.12, for a total value of $265,282.56. Following the sale, the executive vice president directly owned 16,989 shares in the company, valued at $1,174,279.68. This represents a 18.43% decrease in their position. The disclosure for this sale can be found here. Insiders sold 15,102 shares of company stock worth $1,046,607 over the last three months. Insiders own 0.08% of the company's stock.

Institutional Inflows and Outflows

A number of hedge funds have recently added to or reduced their stakes in the company. Vanguard Group Inc. increased its stake in PayPal by 0.3% in the first quarter. Vanguard Group Inc. now owns 86,221,849 shares of the credit services provider's stock valued at $5,625,976,000 after acquiring an additional 276,339 shares during the last quarter. Norges Bank bought a new position in PayPal in the second quarter valued at approximately $921,570,000. Artisan Partners Limited Partnership increased its stake in PayPal by 1.6% in the second quarter. Artisan Partners Limited Partnership now owns 11,992,031 shares of the credit services provider's stock valued at $891,248,000 after acquiring an additional 184,014 shares during the last quarter. Deutsche Bank AG increased its stake in PayPal by 19.1% in the first quarter. Deutsche Bank AG now owns 11,238,218 shares of the credit services provider's stock valued at $733,294,000 after acquiring an additional 1,798,330 shares during the last quarter. Finally, Invesco Ltd. increased its stake in PayPal by 5.5% in the second quarter. Invesco Ltd. now owns 10,038,584 shares of the credit services provider's stock valued at $746,068,000 after acquiring an additional 522,514 shares during the last quarter. 68.32% of the stock is owned by institutional investors.

PayPal Price Performance

The business's 50 day moving average is $68.98 and its 200-day moving average is $69.60. The firm has a market capitalization of $65.03 billion, a P/E ratio of 14.54, a PEG ratio of 1.07 and a beta of 1.44. The company has a quick ratio of 1.33, a current ratio of 1.33 and a debt-to-equity ratio of 0.56.

PayPal (NASDAQ:PYPL - Get Free Report) last posted its earnings results on Tuesday, July 29th. The credit services provider reported $1.40 earnings per share for the quarter, topping analysts' consensus estimates of $1.30 by $0.10. The firm had revenue of $8.29 billion for the quarter, compared to analysts' expectations of $8.08 billion. PayPal had a net margin of 14.49% and a return on equity of 25.35%. During the same quarter in the previous year, the firm posted $1.19 earnings per share. PayPal has set its Q3 2025 guidance at 1.180-1.220 EPS. FY 2025 guidance at 5.150-5.300 EPS. As a group, sell-side analysts predict that PayPal Holdings, Inc. will post 5.03 EPS for the current fiscal year.

About PayPal

PayPal Holdings, Inc operates a technology platform that enables digital payments on behalf of merchants and consumers worldwide. It operates a two-sided network at scale that connects merchants and consumers that enables its customers to connect, transact, and send and receive payments through online and in person, as well as transfer and withdraw funds using various funding sources, such as bank accounts, PayPal or Venmo account balance, PayPal and Venmo branded credit products comprising its installment products, credit and debit cards, and cryptocurrencies, as well as other stored value products, including gift cards and eligible rewards.

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