PayPal (NASDAQ:PYPL) Trading Down 2.8% on Analyst Downgrade

PayPal Holdings, Inc. (NASDAQ:PYPL) shares fell 2.8% during trading on Thursday after HSBC downgraded the stock from a strong-buy rating to a hold rating. The stock traded as low as $38.88 and last traded at $39.90. 42,411,972 shares changed hands during mid-day trading, an increase of 75% from the average session volume of 24,232,543 shares. The stock had previously closed at $41.03.

Other equities research analysts have also issued research reports about the stock. BNP Paribas Exane reduced their price target on shares of PayPal from $71.00 to $69.00 and set a “neutral” rating for the company in a research report on Tuesday, December 2nd. Royal Bank Of Canada reduced their target price on shares of PayPal from $91.00 to $59.00 and set an “outperform” rating for the company in a report on Wednesday. Sanford C. Bernstein reiterated a “market perform” rating on shares of PayPal in a research note on Wednesday, December 17th. Citigroup reduced their price objective on PayPal from $60.00 to $42.00 and set a “neutral” rating for the company in a research note on Wednesday. Finally, KGI Securities lowered their target price on PayPal from $85.00 to $80.00 in a research report on Monday, November 10th. Ten equities research analysts have rated the stock with a Buy rating, thirty have given a Hold rating and four have assigned a Sell rating to the company. According to data from MarketBeat, the company has a consensus rating of “Hold” and a consensus target price of $64.28.

Insider Buying and Selling

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

Key Stories Impacting PayPal

Here are the key news stories impacting PayPal this week:

• Positive Sentiment: Deep-value case and buyback/dividend plan underpin a near-term bargain narrative; bulls point to low forward P/E, strong free cash flow and discretionary buybacks/new dividend as a potential floor. Read More.
• Positive Sentiment: Some investors view a new CEO as a catalyst — profiles of Enrique Lores suggest his turnaround/operational experience could help execution if appointed. Read More.
• Positive Sentiment: Several bullish commentaries argue long-term investors can be rewarded if PayPal stabilizes its product growth and execution — fueling bargain-hunting bounces. Read More.
• Neutral Sentiment: Compass Point moved to Neutral, reflecting that some uncertainty (CEO transition, guidance) is now priced in — not a clear buy/sell signal. Read More.
• Neutral Sentiment: Analysts are split: many cut targets and some keep “buy”/“outperform” calls, leaving consensus views mixed and volatility likely as estimates are re-worked. Read More.
• Negative Sentiment: Q4 results disappointed — EPS and revenue missed expectations and management issued lower 2026 guidance, which triggered the initial selloff and higher volatility. Read More.
• Negative Sentiment: CEO Alex Chriss was fired amid the branded-checkout slowdown and guidance cut; leadership turnover increases execution risk during a sensitive transition. Read More.
• Negative Sentiment: Regulatory/litigation risk surfaced: a securities investigation was announced into the gap between prior outlook and reported results, adding legal and disclosure uncertainty. Read More.
• Negative Sentiment: Heavy analyst price-target cuts, downgrades and visible insider selling amplified the selloff and investor caution this week. Read More.

Institutional Investors Weigh In On PayPal

A number of hedge funds have recently made changes to their positions in PYPL. Brighton Jones LLC grew its holdings in shares of PayPal by 15.2% in the fourth quarter. Brighton Jones LLC now owns 6,989 shares of the credit services provider’s stock valued at $596,000 after purchasing an additional 924 shares in the last quarter. Revolve Wealth Partners LLC bought a new position in PayPal during the fourth quarter valued at $248,000. Sivia Capital Partners LLC grew its stake in shares of PayPal by 41.5% in the 2nd quarter. Sivia Capital Partners LLC now owns 4,470 shares of the credit services provider’s stock worth $332,000 after buying an additional 1,310 shares in the last quarter. DAVENPORT & Co LLC grew its stake in shares of PayPal by 11.1% in the 2nd quarter. DAVENPORT & Co LLC now owns 13,156 shares of the credit services provider’s stock worth $978,000 after buying an additional 1,311 shares in the last quarter. Finally, Venturi Wealth Management LLC increased its holdings in shares of PayPal by 9.5% in the 2nd quarter. Venturi Wealth Management LLC now owns 6,600 shares of the credit services provider’s stock worth $491,000 after buying an additional 575 shares during the last quarter. 68.32% of the stock is currently owned by hedge funds and other institutional investors.

PayPal Price Performance

The company has a current ratio of 1.29, a quick ratio of 1.34 and a debt-to-equity ratio of 0.49. The firm’s 50-day moving average price is $57.18 and its 200-day moving average price is $64.44. The stock has a market capitalization of $37.21 billion, a PE ratio of 7.47, a PEG ratio of 0.77 and a beta of 1.43.

PayPal (NASDAQ:PYPL) last issued its quarterly earnings data on Tuesday, February 3rd. The credit services provider reported $1.23 earnings per share for the quarter, missing the consensus estimate of $1.29 by ($0.06). PayPal had a return on equity of 25.42% and a net margin of 15.77%.The company had revenue of $8.68 billion for the quarter, compared to the consensus estimate of $8.82 billion. During the same period in the previous year, the firm earned $1.19 earnings per share. The company’s revenue was up 4.0% compared to the same quarter last year. On average, equities analysts forecast that PayPal Holdings, Inc. will post 5.03 EPS for the current fiscal year.

PayPal Announces Dividend

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 issued a dividend of $0.14 per share. This represents a $0.56 annualized dividend and a yield of 1.4%. The ex-dividend date is Wednesday, March 4th. PayPal’s dividend payout ratio is presently 10.35%.

About PayPal

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.