2020 and 2021 were anomalies to Paypal's growth pattern due to COVID. Paypal's Net income on annual basis from DEC 2019 to 2022 represents a 1.62% decrease. The last 2 quarters saw strong net income growth over the previous 3 from Dec 2021- Jun 2022. September of 2022 realized 22% growth in net income for the respective quarter of 2021 and 491% Q/Q. Dec 2022 saw 14.9% net income growth for the respective prior year quarter and 30% decrease Q/Q. This could be viewed as the industry and company returning to prior growth patterns.
Paypal is currently valued 30% below where it was prior to COVID with similar fundamentals. Morningstar Rates PYPL as a 5 Star stock at 44% discount. Fair Value of
135
implies a 24.1 multiple of projected 2024 adjusted EPS.
Paypal is not necessarily cheap right now depending on how you value it, but when comparing several growth rates to the sector median you will see that PYPL valuation risk is minimal.
From a TA perspective, an intermediate trend- mean reversion to recent prices combined with a Fib retracement of 61.8% could see the SP retrace to 190-216 during a period exuberance in best case scenario, barring another pandemic.
Paypal is currently valued 30% below where it was prior to COVID with similar fundamentals. Morningstar Rates PYPL as a 5 Star stock at 44% discount. Fair Value of
135
implies a 24.1 multiple of projected 2024 adjusted EPS. Paypal is not necessarily cheap right now depending on how you value it, but when comparing several growth rates to the sector median you will see that PYPL valuation risk is minimal.
From a TA perspective, an intermediate trend- mean reversion to recent prices combined with a Fib retracement of 61.8% could see the SP retrace to 190-216 during a period exuberance in best case scenario, barring another pandemic.