PayPal (PYPL) Should Be Trading Much Higher
PayPal may be trading low, but according go to industry experts, t is way undervalued when considering where the stock has been in the past.
Quick overview
- PayPal (PYPL) stock fell 0.80% to $45.12, but analysts believe it is undervalued and should be worth around $90.
- The company has undergone restructuring, including the closure of its PayPal Ventures arm, to improve profitability.
- Despite a 40% decline in stock value over the past year, recent earnings reports showed a revenue increase of 7% year-over-year.
- Analysts suggest that as the Q2 earnings report approaches, investor sentiment may shift positively towards PayPal.
PayPal (PYPL) stock fell 0.80% on Monday to hit $45.12, but its true value should be somewhere around twice that, according to analysts.
Several analysts are making the case for PayPal being undervalued right now, and the stock may be trading below its real value by as much as 50%. By the start of July, PayPal stock lost 23% of its value, but it has stabilized in recent weeks.
In February, the company named a new CEO Enrique Lores who took over in March. The stock jumped when he assumed the position but did not make much upward progress since then. The company is going through a lengthy restructuring process that has seen the closure of the PayPal Ventures arm earlier this year.
Is PayPal a Good Investment?
Over the last 12 months, PayPal’s stock has fallen more than 40%, and that has left investors cold on the asset. There has been some news from PayPal that they are making efforts to turn things around. The company’s restructuring ended different ventures that were not as profitable as shareholders would have liked, and the stock is trading slightly above the 50-day average of $43.
Even so, why do some analysts think that PayPal should be trading higher? The Base Case points towards a PayPal value of $90, about twice what it is trading for right now. As the calendar approaches the Q2 earnings report, investors may become more bullish on this stock.
The company expected losses for the first quarter of 2026, but their quarterly report issued on May 1st surprised Wall Street. They recorded revenue of $8.4 billion- an increase of 7% year-over-year. They also beat non-GAAP earnings per share by $0.07 with an EPS of $1.34.
The quiet work being done by the new CEO has not transferred over to the stock value yet. PayPal remains a low-performing stock for 2026, but that could change if more investors see how low the stock is trading compared to the past five years and how analysts are predicting the stock could climb dramatically before the end of the year.
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