PayPal (NASDAQ:PYPL) Shares Down 3.4% on Analyst Downgrade

PayPal Holdings, Inc. (NASDAQ:PYPL) fell 3.4% on Thursday after Zacks Research downgraded the stock from a hold rating to a strong sell rating. The stock traded as low as $38.46 and last traded at $39.08. 27,858,478 shares were traded during mid-day trading, an increase of 13% from the average session volume of 24,663,674 shares. The stock had previously closed at $40.46.

PYPL has been the subject of several other research reports. Truist Financial cut their price target on PayPal from $58.00 to $39.00 and set a “sell” rating for the company in a report on Tuesday. KeyCorp restated a “hold” rating on shares of PayPal in a research report on Wednesday, October 22nd. Piper Sandler cut their target price on PayPal from $76.00 to $74.00 and set a “neutral” rating for the company in a research note on Wednesday, January 14th. William Blair reiterated a “market perform” rating on shares of PayPal in a research note on Tuesday, February 3rd. Finally, Royal Bank Of Canada lowered their price target on shares of PayPal from $91.00 to $59.00 and set an “outperform” rating on the stock in a report on Wednesday, February 4th. Ten analysts have rated the stock with a Buy rating, thirty have given a Hold rating and five have issued a Sell rating to the stock. According to MarketBeat.com, the stock has a consensus rating of “Hold” and a consensus target price of $61.03.

Insiders Place Their Bets

In other news, insider Suzan Kereere sold 4,162 shares of the business’s stock in a transaction on Wednesday, November 19th. The shares were sold at an average price of $59.84, for a total value of $249,054.08. Following the sale, the insider owned 30,983 shares in the company, valued at approximately $1,854,022.72. The trade was a 11.84% decrease in their position. The sale was disclosed in a document filed with the Securities & Exchange Commission, which is accessible through this link. Also, EVP Frank Keller sold 3,478 shares of the company’s stock in a transaction dated Friday, February 6th. The stock was sold at an average price of $40.20, for a total transaction of $139,815.60. Following the completion of the sale, the executive vice president directly owned 51,567 shares in the company, valued at approximately $2,072,993.40. The trade was a 6.32% decrease in their position. The disclosure for this sale is available in the SEC filing. Corporate insiders own 0.08% of the company’s stock.

PayPal News Roundup

Here are the key news stories impacting PayPal this week:

• Positive Sentiment: PayPal announced an agentic AI travel partnership with Sabre and Mindtrip — a move that highlights PayPal’s AI and commerce strategy and could expand payments volume in travel and bookings. Sabre, PayPal, and Mindtrip partner
• Positive Sentiment: Coverage notes Venmo momentum and PayPal’s AI investments as potential growth drivers vs. competitors — these business positives may support a longer-term recovery if execution improves. PayPal vs. Block
• Neutral Sentiment: Analysts and outlets are parsing next steps after the Q4 miss and CEO transition; pieces summarize strategic options but offer no immediate catalyst. What’s next after Q4 crash
• Negative Sentiment: Multiple law firms (Kessler Topaz; Pomerantz) have opened investor investigations into PayPal, increasing legal/liability risk and weighing on sentiment. Kessler Topaz investigation notice Pomerantz investor alert
• Negative Sentiment: Analysts have cut ratings and targets — Zacks moved PayPal to a “Strong Sell” and several firms trimmed EPS/price targets (e.g., Daiwa to $42) — pressuring the stock. Zacks downgrade Daiwa cuts price target
• Negative Sentiment: Market commentary highlights the scale of recent share losses and lingering execution issues; retail sentiment has turned bearish and shares have plunged year-to-date. Execution crisis coverage
• Negative Sentiment: Revenue missed expectations and management change was flagged after Q4, creating short-term uncertainty around guidance and execution. Revenue miss & CEO change

Institutional Investors Weigh In On PayPal

Hedge funds and other institutional investors have recently added to or reduced their stakes in the stock. Norges Bank bought a new position in shares of PayPal during the fourth quarter worth approximately $949,758,000. Vanguard Group Inc. grew its position 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 in the last quarter. Dimensional Fund Advisors LP increased its holdings in shares of PayPal by 35.9% during the third quarter. Dimensional Fund Advisors LP now owns 8,177,536 shares of the credit services provider’s stock worth $548,520,000 after purchasing an additional 2,160,227 shares during the period. Lazard Asset Management LLC increased its holdings in shares of PayPal by 1,066.0% during the second quarter. Lazard Asset Management LLC now owns 2,106,215 shares of the credit services provider’s stock worth $156,532,000 after purchasing an additional 1,925,583 shares during the period. Finally, Primecap Management Co. CA raised its position in shares of PayPal by 22.3% in the fourth quarter. Primecap Management Co. CA now owns 8,168,490 shares of the credit services provider’s stock valued at $476,876,000 after buying an additional 1,487,560 shares in the last quarter. Institutional investors and hedge funds own 68.32% of the company’s stock.

PayPal Trading Up 3.1%

The firm has a market capitalization of $37.09 billion, a P/E ratio of 7.45, a PEG ratio of 1.01 and a beta of 1.43. The company has a quick ratio of 1.29, a current ratio of 1.29 and a debt-to-equity ratio of 0.49. The firm has a 50 day moving average of $55.01 and a 200-day moving average of $63.16.

PayPal (NASDAQ:PYPL) last announced 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). The company had revenue of $8.68 billion during 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 period in the prior year, the firm earned $1.19 earnings per share. On average, equities research analysts predict that PayPal Holdings, Inc. will post 5.03 earnings per share for the current fiscal year.

PayPal Dividend Announcement

The company also recently disclosed a quarterly dividend, which will be paid on Wednesday, March 25th. Investors of record on Wednesday, March 4th will be given a dividend of $0.14 per share. The ex-dividend date of this dividend is Wednesday, March 4th. This represents a $0.56 annualized dividend and a yield of 1.4%. PayPal’s dividend payout ratio is currently 10.35%.

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.