PayPal has reported a net income of $1.44bn in the fourth quarter (Q4) of 2025, up 28% from $1.12bn in the same period of 2024. Total Payment Volume for the quarter reached $475.1bn, representing 9% growth on a reported basis. Payment transactions in the quarter stood at 6.8 billion, an increase of 2% year‑on‑year, while active accounts edged up 1.1% to 439 million. The US payments firm’s operating income rose to $1.51bn in Q4 2025 from $1.44bn a year earlier. Net revenue for the quarter increased to ...

Core Viewpoint - PayPal Holdings Inc. is currently viewed as a large-cap stock under $50, with mixed analyst ratings and price target adjustments reflecting concerns over its performance and leadership changes [1][3]. Group 1: Analyst Ratings and Price Targets - Compass Point upgraded PayPal to Neutral from Sell, adjusting its price target to $51 from $55 [1]. - TD Cowen lowered its price target for PayPal from $65 to $48, maintaining a Hold rating due to disappointing Q4 2025 exit rates and a weak outlook for 2026 [2]. - Bank of America reduced its price target on PayPal to $48 from $68, citing a surprise CEO change and below-expectation Q4 2025 results [3]. Group 2: Company Performance and Outlook - PayPal is experiencing sluggish performance in branded online checkout and high investment costs, leading analysts to label 2026 as another transition year [2]. - The company is facing uncertainty regarding whether its issues are systemic or related to management, with shares expected to remain stagnant until new leadership demonstrates effectiveness [3]. Group 3: Company Overview - PayPal operates a technology platform that facilitates digital payments for merchants and consumers globally [4].

Core Insights - PayPal's decline is attributed to a strategic choice for safety over innovation during a transformative period in the payments industry [1] - The company's branded checkout growth has stagnated at just 1%, indicating a failure to adapt to competitive pressures [2] Strategic Missteps - The focus on optimizing total payment volume rather than leveraging unique product offerings was a critical error [2] - After the eBay spinoff, leadership transitioned from product-focused individuals to financial engineers, which led to a cultural shift prioritizing short-term predictability over long-term platform risk [3] Missed Opportunities - Acquisitions like Honey and Xoom did not provide strategic leverage and failed to enhance the critical checkout experience [4] - The current leadership change raises questions about whether the board will realign incentives to transform PayPal into the network it was intended to be [4]

PayPal Holdings ( PYPL ) has had better days, to say the least. The transactions and payments processing company is facing competitive pressures across its operating segments, and its just-released results put a stamp to those pressures. Adding to the woes is a leadershipAnalyst’s Disclosure: I/we have no stock, option or similar derivative position in any of the companies mentioned, and no plans to initiate any such positions within the next 72 hours. I wrote this article myself, and it expresses my own op ...

Core Viewpoint - PayPal reported weaker-than-expected earnings for Q4 2025, missing both revenue and profit expectations due to a slowdown in its 'Branded Checkout' business, leading to a 20% drop in shares during a panic-driven sell-off [1] Financial Performance - PayPal's earnings for Q4 2025 were below expectations, indicating challenges in its financial performance [1] - The company experienced a significant decline in share price, dropping 20% as a result of the disappointing earnings report [1] Business Segment Analysis - The slowdown in the 'Branded Checkout' business was a key factor contributing to the missed revenue and profit targets [1]

Core Viewpoint - The article summarizes significant research calls from Wall Street, highlighting upgrades for various companies that could influence market movements [1] Group 1: Upgrades - BofA upgraded Five Below (FIVE) to Buy from Underperform with a price target of $233, increased from $158, citing improvements under new leadership [2] - Compass Point upgraded PayPal (PYPL) to Neutral from Sell with a price target of $51, indicating that shares are reflecting "peak uncertainty" following the earnings report [2] - Citizens upgraded Airbnb (ABNB) to Outperform from Market Perform with a price target of $160, anticipating multiple catalysts that could enhance performance [2] - Mizuho upgraded Booking Holdings (BKNG) to Outperform from Neutral with an unchanged price target of $6,000, suggesting a 30% upside and viewing the recent pullback as a buying opportunity [2] - Baird upgraded GE Vernova (GEV) to Outperform from Neutral with a price target of $923, up from $701, believing the energy infrastructure cycle is still in early stages and GE Vernova will benefit significantly [2]

Core Viewpoint - The article emphasizes the importance of generating alpha through independent investment strategies, focusing on a generalist approach across various sectors with potential for outperforming the S&P 500 [1] Group 1: Investment Strategy - The company manages its portfolio primarily through a Self Managed Super Fund, aiming for a holding period that ranges from a few quarters to multiple years [1] - The investment approach includes building and maintaining spreadsheets that track historical financial data, key metrics, and performance indicators [1] - The company prioritizes assessing a company's delivery and outlook on five key drivers of DCF valuation rather than projecting financials far into the future [1] Group 2: Research Methodology - The research process involves monitoring industry news, reports, and other analysts' coverage, particularly during significant events like CEO changes [1] - The company rarely constructs DCF models for long-term projections, finding more value in understanding current performance and market conditions [1] - In cases of companies with high trading multiples, a reverse DCF analysis is conducted to evaluate implied growth rates [1]

Core Insights - PayPal is replacing CEO Alex Chriss with Enrique Lores due to unmet expectations regarding the pace of change and execution over the past two years [1] - Lores, who has been a board member for nearly five years and board chair since July 2024, aims to accelerate innovation in the rapidly evolving payments industry [1] - The company reported fourth-quarter results showing an adjusted profit of $1.23 per share on revenue of $8.68 billion, which fell short of analyst expectations [1] Leadership Changes - Enrique Lores will officially take over as CEO on March 1, with Jamie Miller serving as interim CEO until then [1] - David Dorman has been appointed as independent chair effective immediately [1] Financial Performance - PayPal's fourth-quarter adjusted profit was $1.23 per share, while revenue reached $8.68 billion [1] - These results did not meet the expectations of analysts, who anticipated a profit of $1.29 per share and revenue of $8.77 billion [1]

Core Viewpoint - PayPal Holdings Inc. is currently considered one of the most undervalued quality stocks, despite recent downgrades and competitive pressures in the digital payments space [1][7]. Group 1: Analyst Ratings and Price Targets - Rothschild & Co. Redburn downgraded PayPal from Neutral to Sell, lowering its price target from $70 to $50 [1][7]. - Cantor Fitzgerald analyst Ramsey El-Assal initiated coverage with a Neutral rating and a price target of $60, highlighting recent strategic moves that could enhance profitability and growth [3]. Group 2: Competitive Landscape - The firm noted that consumer preferences are shifting towards alternative payment methods, with platforms like Shop Pay, Stripe Link, Apple Pay, and Google Pay gaining traction among users [2]. - Despite the competitive environment, El-Assal anticipates that PayPal's strategic initiatives will lead to increased volume and revenue growth by FY2026 [3]. Group 3: Company Overview - PayPal operates a technology platform that facilitates digital payments for both merchants and consumers globally [4].

Market Overview - Stocks experienced a decline on Tuesday, with a notable rotation out of technology stocks being cited as a contributing factor. The Nasdaq fell by 1.43% to 23,255, while the S&P 500 decreased by 0.84% to 6,917. The Dow Jones closed at 49,230, down 0.43%, and the Russell 2000 was the only index to gain, closing up 0.31% at 2,648 [1]. Treasury Bonds - Treasury yields were mixed, with buyers favoring bonds with maturities of 5 to 30 years. The 30-year bond closed at 4.90%, and the benchmark 10-year note ended at 4.27%. The ISM Manufacturing PMI for January 2026 was reported at 52.6, indicating economic expansion [1]. Oil and Gas - Oil prices rose due to renewed geopolitical tensions and optimism regarding a new trade deal with India. Brent Crude finished at $67.89, up 2.4%, and West Texas Intermediate closed at $63.80, also up 2.4%. Natural gas prices increased by 4.17% to $3.37 [1]. Gold and Silver - Gold prices rebounded significantly, closing at $4,945, up 6.6%. Silver also saw gains, closing at $85.65, up 7.47%. This rebound followed a period of rapid selling, with many investors encouraged to "Buy the Dip" [1]. Cryptocurrency - The cryptocurrency market faced high volatility, with Bitcoin dropping to levels not seen since November 2024, falling to between $72,800 and $73,000, a decrease of over 6% at its lowest point. This sell-off was attributed to over $2.5 billion in leveraged position liquidations [1]. Analyst Upgrades - PayPal Holdings Inc. was upgraded to Neutral from Sell, with a target price reduced to $51 from $55 [1]. - Lumentum Holdings Inc. was raised to Buy from Neutral, with a target price increased to $526 from $147 [1]. - Devon Energy Corp. was upgraded to Overweight from Equal Weight, with a target price raised to $50 from $42 [1]. - Cloudflare Inc. was upgraded to Buy from Neutral, with a target price of $199 [1]. - Airbnb Inc. was upgraded to Outperform from Market Perform, with a target price of $160 [1]. Analyst Downgrades - Webster Financial Corp. was downgraded to Sector Perform from Outperform, with a target price adjusted to $75 from $72 [1]. - Transdigm Group Inc. was cut to Neutral from Outperform, with a target price reduced to $1,400 from $1,650 [1]. - Himax Inc. was downgraded to Equal Weight from Overweight, with a target price of $8 [1]. - Alpha Metallurgical Resources Inc. was cut to Neutral from Buy, with a target price of $203 [1]. - AES Corp. was downgraded to Equal Weight from Overweight, with a target price of $15 [1]. Analyst Initiations - Verastem Inc. was initiated with a Buy rating and a target price of $18 [2]. - SEI Investments Co. was started with a Buy rating and a target price of $115 [2]. - Levi Strauss & Co. was initiated with a Buy rating and a target price of $25 [2]. - Kontoor Brands Inc. was initiated with a Hold rating and a target price of $65 [2]. - CTO Realty Growth Inc. was initiated with an Overweight rating and a target price of $20 [2].