PayPal or how the results of the third quarter are your great hope

PayPal or how the results of the third quarter are your great hope

PayPal Holdings has just experienced the great rebound experienced on Wall Street. And although many consider it to be the flower of a day, although times of uncertainty and stock market declines may be repeated in this, the continuity in the movement is something else, and it seems that it will not occur.

The value continues to look with great concern at the tension experienced at the end of September in the market which, in its case, although it did not mean a return to the lows for the year registered in July, does prevent it from a larger improvement that it needs given its strong annual falls.

The next test, without a doubt, will come from the hand of its results for the third quarter of the year and the valuation that the market makes of them. It is expected to post earnings in mid-November. Zacks estimates indicate that earnings per share could reach $0.84 per share, which would mean a year-over-year drop of 24.32% compared to the same quarter of the previous year.

PayPal recommendations and target value price

As for revenue estimates, they could reach 6,840 million dollars in the quarter, 10.58% more than in the third of 2021. For the entire year, the consensus gathered highlights that analysts expect average earnings of 3.93 euros per share, 14.5% below 2021 and revenues that rise to 27,910 million dollars, with which they would grow 10%.

In its stock chart, PayPal shares rise 6.3% in the last week while, in the month, they cut 2%. In the quarter the advances are powerful, of 25.6%, although it still maintains strong annual falls that exceed 50%.

Just this week, a New Jersey pension fund has filed a class action lawsuit against PayPal on the grounds that it has defrauded investors by issuing statements they consider “false and misleading” about the origin and evolution of its new net active accounts, one of the key metrics for investors to decide whether or not to put their money into the company’s stock. It so happens that he is also one of the company’s institutional investors

As for the recommendations, from Susquehanna they reduce their price target to 100 dollars from the previous 115 and lower their rating to neutral from positive for PayPal shares. Analyst James Friedman considers that Braintree is winning the battle and also quickly PayPal in a part of the total volume of payments, creating a negative leverage.

Already from the consensus that TipRanks collects from the 32 analysts who postulate on the value, 24 in particular are committed to buying and 8 more to keeping their shares in their portfolio. As for its average target price, it reaches 120.82 dollars per share, with a potential that exceeds 28% over 12 months.

From Deutsche Bank they raise their target price to reflect what they consider an improvement in the company’s prospects, with a new PO of 140 dollars from the previous 114 for the stock. He considers that his new expectations, from the hand of the new financial director and the activist investor Eliott Investment, seem achievable, even more rigorously in one of the company’s great debts, we are talking about cost savings.

Since Raymond James, its analyst John Davis has put on the table a target price of 123 dollars per PayPal share with an improvement in the rating to overweight from neutral, understanding how more credible its estimates are, its guides for future quarters, especially in terms of regarding the improvement in income in the latter part of 2022 and in 2023.

The premium indicators elaborated by Estrategias de Inversión build a technical panorama for PayPal that, in bearish mode, corrects its total score by two points, which barely reaches 1 of the 10 possible to which the value can aspire. Only in positive is the volume of business in the long term, which is growing.

The rest bearish trend in its two aspects, both in the medium and long term, total moment, slow and fast, which is negative for PayPal shares and its volatility, which is increasing in the medium and also in the long term.

Samuel Edwards
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