PayPal Holdings, Inc. (PYPL)

After a couple of years of rapid growth during the COVID-19 pandemic, PayPal (PYPL 3.43%) ran out of steam as the world returned to normalcy. And its stock fell sharply.

Fed Chair Powell's dovish stance signals a likely September rate cut, providing a relief rally for PayPal Holdings, Inc. investors. PayPal faces near-term headwinds from competition and economic uncertainty, but management's margin-focused strategy and strong platform fundamentals support medium-term recovery. Emerging threats from stablecoins and evolving digital payments create long-term uncertainty, yet PayPal's free cash flow and buybacks remain robust.

PYPL's BNPL gains momentum with 20% payment volume growth, global scale, and strong merchant adoption amid rising competition and credit risks.

Investors with an interest in Financial Transaction Services stocks have likely encountered both Paypal (PYPL) and MasterCard (MA). But which of these two stocks is more attractive to value investors?

Shares of PayPal Holdings, Inc. (NASDAQ:PYPL) plummeted 11.12% over the past month after gaining 4.23% the month prior.

PayPal is undervalued, with investors overlooking its consistent growth potential, strong network effects, and new AI-driven monetization opportunities. Secular trends in digital payments, cost-cutting, and accelerating Venmo monetization support stable mid-single-digit growth, even amid macro headwinds. Upcoming AI integration and the launch of PayPal World expand PayPal's moat, offering significant upside through new revenue streams and global user growth.

PayPal's Q2 results prove its turnaround is succeeding, with a strong EPS beat and its sixth consecutive quarter of profitable, disciplined growth. Powerful operating leverage is building as transaction margin dollars grew 8%, significantly outpacing revenue and signaling a successful pivot to higher-quality earnings. Key growth engines like Venmo are accelerating with 20% revenue growth, while the critical Braintree platform has stabilized and is now poised for growth.

PYPL, IBKR and HOOD are showing earnings strength as Bitcoin pulls back before its next rally.

Branded checkout TPV grew 5% YoY in Q2 2025, lagging global e-commerce, signaling persistent share-of-wallet erosion. The unbranded PSP segment, led by Braintree, is shifting to disciplined profitability, with transaction margin dollars rising despite slower TPV. Adjusted free cash flow fell 42% YoY to $656M, raising concerns about the sustainability of capital returns and buybacks.

I am downgrading PayPal to 'Sell', due to increased competition, mediocre growth, and rising balance sheet risks. PayPal faces intense competition from Stripe, Adyen, and others, with rivals growing faster and gaining market share. Rising credit losses, higher sales and marketing expenses, and increased long-term debt signal worsening fundamentals and margin pressure.

The second quarter's earnings season is winding down. And let's get it out of the way: PayPal (PYPL -0.70%) was not one of the top performers of earnings season.

PayPal's global scale and steady profitability make it a stronger buy compared to Block's innovation-driven growth.

Paypal (PYPL) has received quite a bit of attention from Zacks.com users lately. Therefore, it is wise to be aware of the facts that can impact the stock's prospects.

PayPal (PYPL -0.20%), one of the world's largest digital payment platforms, was spun off from eBay 10 years ago. If you had invested $1,000 in PayPal's stock on that first day's opening trade, your investment would have grown to $7,411 when it closed at its all-time high in July 2021.

Despite President Donald Trump's trade wars and concerns about a possible recession, equity markets have performed relatively well this year, with the S&P 500 (^GSPC -0.29%) up 10% since January. Some corporations, however, have not been as fortunate, including PayPal (PYPL -0.20%) and DexCom (DXCM 1.23%), both of which have underperformed the market due to company-specific issues.

Bitcoin's record-breaking run fuels optimism for crypto-linked stocks like IBKR, HOOD and PYPL with strong 2025 growth potential.