PayPal (NASDAQ:PYPL) Stock Price Down 20.3% After Earnings Miss

PayPal Holdings, Inc. (NASDAQ:PYPL)’s share price was down 20.3% on Tuesday after the company announced weaker than expected quarterly earnings. The stock traded as low as $41.43 and last traded at $41.70. Approximately 140,808,409 shares traded hands during trading, an increase of 545% from the average daily volume of 21,828,143 shares. The stock had previously closed at $52.33.

The credit services provider reported $1.23 EPS for the quarter, missing analysts’ consensus estimates of $1.29 by ($0.06). The company had revenue of $8.68 billion for the quarter, compared to analyst estimates of $8.82 billion. PayPal had a net margin of 15.77% and a return on equity of 25.42%. PayPal’s revenue was up 4.0% on a year-over-year basis. During the same quarter last year, the company posted $1.19 EPS.

PayPal Dividend Announcement

The business also recently declared a quarterly dividend, which will be paid on Wednesday, March 25th. Investors of record on Wednesday, March 4th will be given a $0.14 dividend. The ex-dividend date is Wednesday, March 4th. This represents a $0.56 dividend on an annualized basis and a dividend yield of 1.4%. PayPal’s dividend payout ratio (DPR) is 11.22%.

Key PayPal News

Here are the key news stories impacting PayPal this week:

• Positive Sentiment: Some investors/analysts flag a potential buying opportunity because PYPL is deeply oversold after the sell‑off; contrarian pieces and technical analyses argue support levels could attract buyers. Should You Buy The Dip In PayPal Stock?
• Positive Sentiment: A handful of firms kept constructive views (or less bearish stances) despite cuts to targets, arguing PayPal’s cash flow, buyback capacity and long‑term position in payments give upside if execution restores growth. Analyst notes and reiterations
• Neutral Sentiment: Board appointed Enrique Lores (former HP CEO and PayPal board chair) as incoming CEO (effective March 1) with Jamie Miller interim — a major leadership shift whose impact is uncertain: it may reassure some investors but also signals the board’s dissatisfaction with past execution. PayPal Appoints Enrique Lores as CEO
• Neutral Sentiment: PayPal announced a modest quarterly dividend (small yield) — positive for income‑seeking holders but unlikely to move the stock materially given current execution concerns.
• Negative Sentiment: Q4 results missed expectations (adjusted EPS $1.23 vs. ~$1.29 est.; revenue ~$8.68B vs. ~$8.8B) and management lowered near‑term profit guidance for 2026 — the primary catalyst for the price decline. Q4 results and call
• Negative Sentiment: Multiple analysts cut price targets or downgraded ratings after the quarter and CEO change, increasing sell pressure and reducing near‑term institutional support. Analyst downgrades and price‑target changes
• Negative Sentiment: Shareholder/legal risk rose: several law firms have opened securities‑fraud investigations probing the gap between prior outlooks and results, adding uncertainty and potential headline risk. Securities investigation notice
• Negative Sentiment: Public criticism from former PayPal leaders and commentary about slowing branded‑checkout and transactions‑per‑account growth have amplified concerns that PayPal’s core growth engine is stalling. Former exec criticism

Wall Street Analysts Forecast Growth

PYPL has been the subject of several recent analyst reports. Compass Point upgraded shares of PayPal from a “sell” rating to a “neutral” rating and set a $51.00 target price for the company in a report on Wednesday. Keefe, Bruyette & Woods raised their price objective on shares of PayPal from $85.00 to $90.00 and gave the stock an “outperform” rating in a research note on Wednesday, October 29th. Jefferies Financial Group reiterated a “hold” rating on shares of PayPal in a research report on Wednesday, January 7th. Macquarie set a $58.00 target price on PayPal in a report on Wednesday. Finally, Wall Street Zen cut PayPal from a “buy” rating to a “hold” rating in a research report on Sunday, January 18th. Ten analysts have rated the stock with a Buy rating, thirty have issued a Hold rating and five have issued a Sell rating to the company’s stock. According to data from MarketBeat, PayPal currently has a consensus rating of “Hold” and an average target price of $62.88.

Insider Buying and Selling at PayPal

In related news, EVP Aaron Webster sold 9,282 shares of PayPal stock in a transaction on Monday, November 10th. The stock was sold at an average price of $66.29, for a total transaction of $615,303.78. Following the completion of the sale, the executive vice president owned 35,699 shares of the company’s stock, valued at approximately $2,366,486.71. This trade represents a 20.64% decrease in their ownership of the stock. The transaction was disclosed in a document filed with the Securities & Exchange Commission, which is accessible through the SEC website. Also, insider Suzan Kereere sold 4,162 shares of the business’s stock in a transaction dated Wednesday, November 19th. The shares were sold at an average price of $59.84, for a total value of $249,054.08. Following the completion of the transaction, the insider owned 30,983 shares in the company, valued at $1,854,022.72. This trade represents a 11.84% decrease in their position. The SEC filing for this sale provides additional information. 0.08% of the stock is currently owned by company insiders.

Hedge Funds Weigh In On PayPal

Several hedge funds and other institutional investors have recently added to or reduced their stakes in PYPL. Vanguard Group Inc. increased its stake in shares of PayPal by 6.5% during the 4th quarter. Vanguard Group Inc. now owns 90,376,927 shares of the credit services provider’s stock worth $5,276,205,000 after purchasing an additional 5,534,462 shares during the last quarter. Capital Research Global Investors boosted its holdings in PayPal by 2.3% in the third quarter. Capital Research Global Investors now owns 27,953,803 shares of the credit services provider’s stock worth $1,874,637,000 after purchasing an additional 636,441 shares in the last quarter. Norges Bank acquired a new position in PayPal during the second quarter worth $921,570,000. Artisan Partners Limited Partnership raised its holdings in PayPal by 1.6% during the second quarter. Artisan Partners Limited Partnership now owns 11,992,031 shares of the credit services provider’s stock valued at $891,248,000 after buying an additional 184,014 shares in the last quarter. Finally, Invesco Ltd. raised its holdings in PayPal by 10.9% during the third quarter. Invesco Ltd. now owns 11,131,949 shares of the credit services provider’s stock valued at $746,508,000 after buying an additional 1,093,365 shares in the last quarter. Institutional investors own 68.32% of the company’s stock.

PayPal Stock Down 1.6%

The company has a market cap of $38.39 billion, a price-to-earnings ratio of 7.58, a PEG ratio of 0.52 and a beta of 1.43. The business has a 50-day simple moving average of $58.06 and a two-hundred day simple moving average of $64.85. The company has a quick ratio of 1.34, a current ratio of 1.29 and a debt-to-equity ratio of 0.49.

PayPal Company Profile

PayPal Holdings, Inc operates a global digital payments platform that enables consumers and merchants to send and receive payments online, on mobile devices and at the point of sale. The company provides a broad set of payment solutions, including a digital wallet, merchant payment processing, checkout services, invoicing and fraud-management tools. PayPal’s platform is designed to support e-commerce, in-person retail and person-to-person transfers, targeting both individual consumers and businesses of varying sizes.

Key products and services in PayPal’s portfolio include the PayPal wallet and checkout ecosystem, the Venmo peer-to-peer mobile app, Braintree’s developer-focused payment gateway, Xoom for international money transfers, and PayPal Credit and buy-now-pay-later options.