Author: Patryk Grosicki
Publication date: 09.11.2023
PayPal Holdings, Inc. is an American international financial technology business. In particular, it operates an online payments system in the majority of countries that enable online money transfers. Nowadays, it might be serving as an electronic alternative to traditional paper methods like cheques and money orders.
Benefits from stock trading?
Let’s focus on whether there are foreseeable and viable opportunities to benefit from stock trading in the long run. At its height, the price of this company's shares might reach levels exceeding $300 per share. Since then, it has been steadily declining, ranging between $50 and $55 per share. Could you consider that a suitable time to enter the market?
Imagine the size
Paypal growth potential is strictly adjusted to the condition of the e-commerce market worldwide. As a company with over 400 million members, and 190 million monthly active users, PayPal remains the world's most popular digital wallet. PayPal also possesses approximately one in every four credit and debit cards issued globally in its digital vault.
Above should be considered as a compelling reason to invest in this company. Favorable macroeconomic factors, as well as internal activities aimed at increasing market share, can boost share prices. What’s more, actual low price combined with a favorable corporate outlook and market predictions will be a good hint to invest in.
What compounds the business outlook – internal?
PayPal would benefit greatly from robust growth in terms of total payment volume (TPV) and transactions per active account. These are two of the most essential data indicators for investors to consider with this firm. They show not just the expansion of the payments platform, but also how engaged users are.
Stock anticipates strong financial results in the third quarter as holiday spending increases. However, it may not be enough to arouse investor enthusiasm and significantly increase share prices. According to analytics, following that massive drop, this year stock prices could push the stock back up to $70, representing a roughly 20% gain.
Analysts have been surprised by how resilient the economy has stayed last months, besides peaking interest rates. A downturn in the economy, whether mild or severe, could put pressure on the stock market as a whole. If the FED believes that inflation still needs to be reduced still, it may decide to raise rates one more time until the end of the year. So, markets may interpret it as a negative sign, reflecting in share prices.
However, if rates stay unchanged and the Fed instead makes comments about possibly cutting rates, growth stocks, including PayPal. Then, PayPal might be ready to begin with the bull run on the market.
Market cycle of Paypal Stock prices
On the surface, PayPal stock prices appear to be following the market cycle. Following two consecutive peaks of euphoria and complacency two years ago, it has now entered the disbelief phase. If the stock prices continue in this pattern, the next market cycle could be a good time to invest in this company.