Pay analyzed by a Wall Street expert predicts PayPal's share price reaching $95.
PayPal's had a rough couple of years, with the company's stock falling over 80% since its peak in 2021. However, recent results suggest a turnaround might be on the horizon. One Wall Street analyst, Gus Gala from Monness Crespi, has upped his price target on PayPal's stock to $95, representing a potential 61% increase from Monday's closing price. Gala's confidence is backed by PayPal's impressive Q2 revenue growth of 9% and its strong earnings of $1.19 per share, beating analyst predictions by a significant margin.
One of the standout figures was a revival in PayPal's peer-to-peer (P2P) payments, which had seen no growth for three years. This, along with strong results from unbranded card processing and merchant services, contributed to PayPal's solid growth. Management has also boosted its yearly EPS growth forecast to the low to mid-teens, an increase from previous mid- to high single-digit predictions.
In response to its recovery, PayPal plans to ramp up its share repurchases, aiming for at least $6 billion in buybacks in 2024. This is an increase from its previous $5 billion goal. The company's share count has already decreased by nearly 10% due to previous buybacks.
So, with its growth cemented and buybacks set to continue, is PayPal stock a worthwhile investment? Well, if you believe the analysts, it certainly is. PayPal's stock price is predicted to reach $95 by the end of 2025, representing a 16.27% return from its current price. By 2030, the stock price is even forecasted to hit $167.29, before reaching $330.19 by 2040.
However, investors should be aware of potential risks. Despite a significant gain in six months, PayPal's high P/E ratio suggests potential overvaluation and weakness. Meanwhile, while revenue growth has been robust, it fell slightly short of the consensus estimate in the last quarter.
Ultimately, while there are reasons to be optimistic about PayPal's future, investors should conduct their own research and assess their own risk tolerance before making any investment decisions.
After analyst Gus Gala raised his price target for PayPal's stock, indicating a potential 61% increase, many investors might be considering finance-related decisions, such as investing in PayPal shares. The company's strong Q2 revenue growth of 9% and earnings of $1.19 per share have attracted attention, potentially making it a profitable investment opportunity in the world of investing money.
