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PayPal (PYPL) Stock Analysis

This is a peer-relative look at PayPal (PYPL): its performance, risk, profitability, growth, financial strength, dividend, and valuation are each measured against its Financial Services peers, so every number reads in context rather than in isolation.

Company Profile

Company profile fields for PayPal (PYPL)
Profile ItemPYPL
NamePayPal Holdings, Inc.
Country/RegionUnited States
GICS SectorFinancials
GICS Industry GroupFinancial Services
GICS IndustryFinancial Services
GICS Sub-IndustryTransaction & Payment Processing Services
Market Capitalization49.21 billion USD
CurrencyUSD
ExchangeNasdaq
Listing DateJuly 6, 2015
Security TypeCommon Stock

Price Performance

Cumulative Growth

PYPL
GSPC
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PayPal (PYPL) vs. S&P 500 (GSPC): Growth of a $10,000 investment over the past five years. Adjusted for dividends and splits.

Trailing Returns

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Trailing total returns for PayPal (PYPL) and S&P 500 (GSPC). Returns over one year are annualized.

Calendar-Year Returns

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Calendar-year total returns for PayPal (PYPL) and S&P 500 (GSPC). Each bar is that year's total return, measured year-end to year-end.

Performance Metrics

PayPal (PYPL) metric values compared with Financial Services industry-group medians
MetricCurrent stock: PYPLIndustry group median
Total Return (1Y)-7.44%1.90%
Total Return (3Y, Annualized)4.14%12.71%
Total Return (5Y, Annualized)-21.48%2.81%

Risk Profile

Drawdown History

PYPL
GSPC
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PayPal (PYPL) vs. S&P 500 (GSPC): Drawdown from the running peak over the past five years. Each line shows the decline from its prior peak; 0% marks a new high.

Return Distribution

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Distribution of monthly total returns for PayPal (PYPL) and S&P 500 (GSPC). Each bar is the share of months whose return fell in that 5% bucket.

Risk Metrics

PayPal (PYPL) metric values compared with Financial Services industry-group medians
MetricCurrent stock: PYPLIndustry group median
Volatility (1Y, Annualized)42.40%36.24%
Beta (5Y)1.281.04
Max Drawdown (5Y)-81.84%-48.56%

Risk-Adjusted Performance

Risk-Return Positioning

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Each dot is a stock plotted by 1-year volatility (risk) and 1-year return. PYPL is highlighted; the dashed line is the Capital Allocation Line from the risk-free rate through the industry median — dots above it are stronger on a risk-adjusted basis.

Risk-Adjusted Metrics

PayPal (PYPL) metric values compared with Financial Services industry-group medians
MetricCurrent stock: PYPLIndustry group median
Sharpe Ratio (1Y)-0.28-0.09
Sortino Ratio (1Y)-0.37-0.13

Profitability

ROE (TTM)

PayPal (PYPL) posts ROE of 23.83%, in the upper peer quartile. That suggests the company earns more from each dollar of shareholders’ equity than most industry peers, a useful capital-efficiency signal.

PYPL

Financial Services industry group

23.83%

Group distribution
Max
44.78%
PYPL
23.83%
Q3
21.85%
Median
12.91%
Q1
4.48%
Min
-18.71%
Largest peers
MA
231.37%
V
63.51%
PYPL
23.83%
MS
18.04%
GS
17.71%
BRK.A
12.12%
BRK.B
12.12%
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Where PayPal (PYPL) stands on ROE within its Financial Services peer group — the box is the group’s distribution and the dots its largest members.

Net Margin (TTM)

PayPal (PYPL) keeps 13.78% of revenue as net profit, roughly in line with the peer group’s normal net margin range. Its full cost stack is taking a typical share of sales for the industry.

PYPL

Financial Services industry group

13.78%

Group distribution
Max
62.84%
Q3
28.05%
Median
15.36%
PYPL
13.78%
Q1
4.82%
Min
-28.52%
Largest peers
V
51.20%
MA
46.73%
GS
31.21%
MS
25.63%
BRK.A
22.30%
BRK.B
22.30%
PYPL
13.78%
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Where PayPal (PYPL) stands on net margin within its Financial Services peer group — the box is the group’s distribution and the dots its largest members.

Operating Margin (TTM)

PayPal (PYPL) turns 18.41% of revenue into operating profit, roughly in line with the peer group’s normal operating margin range. Its core cost structure looks typical for the industry.

PYPL

Financial Services industry group

18.41%

Group distribution
Max
107.33%
Q3
55.90%
Median
30.09%
PYPL
18.41%
Q1
14.60%
Min
-44.34%
Largest peers
V
63.73%
MA
60.53%
MS
39.00%
GS
38.37%
BRK.A
32.56%
BRK.B
32.56%
PYPL
18.41%
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Where PayPal (PYPL) stands on operating margin within its Financial Services peer group — the box is the group’s distribution and the dots its largest members.

Profitability Metrics

PayPal (PYPL) metric values compared with Financial Services industry-group medians
MetricCurrent stock: PYPLIndustry group median
ROE (TTM)23.83%12.91%
ROA (TTM)4.70%3.60%
Net Margin (TTM)13.78%15.36%
Operating Margin (TTM)18.41%30.09%
Gross Margin (TTM)----

Growth

Revenue Growth

PayPal (PYPL) grew revenue 4.32%, roughly around the peer group's normal range. Top-line momentum looks broadly typical for the industry.

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PayPal (PYPL): Revenue Growth across different time periods, set against Financial Services industry-group medians.

EPS Growth

PayPal (PYPL) grew earnings per share 35.59%, roughly around the peer group's normal range. Bottom-line momentum looks broadly typical for the industry.

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PayPal (PYPL): EPS Growth across different time periods, set against Financial Services industry-group medians.

Growth Metrics

PayPal (PYPL) metric values compared with Financial Services industry-group medians
MetricCurrent stock: PYPLIndustry group median
Revenue Growth (YoY)4.32%9.46%
Revenue Growth (3Y CAGR)6.43%10.90%
EPS Growth (YoY)35.59%7.46%
EPS Growth (3Y CAGR)37.30%13.04%

Financial Strength

Current Ratio (MRQ)

current ratio is set aside for PayPal (PYPL) in Financial Services: these balance sheets are not best read through a current/non-current split, so regulatory, funding, or liquidity-coverage measures usually matter more.

Debt / Equity (MRQ)

debt-to-equity ratio is set aside for PayPal (PYPL) in Financial Services: leverage is part of the business model itself, so capital adequacy, funding mix, and regulatory measures are usually better risk gauges.

Financial Strength Metrics

PayPal (PYPL) metric values compared with Financial Services industry-group medians
MetricCurrent stock: PYPLIndustry group median
Current Ratio (MRQ)----
Debt / Equity (MRQ)----
Net Debt / EBITDA----

Dividends

Dividend Yield (TTM)

PayPal (PYPL) has dividend yield of 0.95%, in the industry’s normal income range. It provides a meaningful dividend without the red flag of an unusually high headline yield.

PYPL

Financial Services industry group

0.95%

Group distribution
Max
9.77%
Q3
3.92%
Median
1.09%
PYPL
0.95%
Q1
0.00%
Min
0.00%
Largest peers
MS
2.40%
GS
2.07%
PYPL
0.95%
V
0.66%
MA
0.53%
BRK.A
0.00%
BRK.B
0.00%
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Where PayPal (PYPL) stands on dividend yield within its Financial Services peer group — the box is the group’s distribution and the dots its largest members.

Dividend Payout Ratio (TTM)

PayPal (PYPL) has payout ratio of 10.69%, within the industry’s typical payout band. The dividend shares profits with investors while leaving earnings coverage that looks normal for the peer group.

PYPL

Financial Services industry group

10.69%

Group distribution
Max
241.07%
Q3
97.36%
Median
25.77%
PYPL
10.69%
Q1
0.00%
Min
0.00%
Largest peers
MS
32.91%
GS
25.88%
V
21.75%
MA
17.63%
PYPL
10.69%
BRK.A
0.00%
BRK.B
0.00%
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Where PayPal (PYPL) stands on payout ratio within its Financial Services peer group — the box is the group’s distribution and the dots its largest members.

Dividend Metrics

PayPal (PYPL) metric values compared with Financial Services industry-group medians
MetricCurrent stock: PYPLIndustry group median
Dividend Yield (TTM)0.95%1.09%
Dividend Payout Ratio (TTM)10.69%25.77%

Valuation

P/E Ratio (TTM)

PayPal (PYPL) trades at P/E ratio of 11.31, near the industry’s usual earnings multiple. The stock is not showing a clear peer discount or premium on trailing earnings.

PYPL

Financial Services industry group

11.31

Group distribution
Max
45.85
Q3
24.64
Median
15.37
PYPL
11.31
Q1
9.68
Min
0.16
Largest peers
V
34.31
MA
34.15
MS
14.39
BRK.A
14.36
BRK.B
14.36
GS
12.45
PYPL
11.31
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Where PayPal (PYPL) stands on P/E ratio within its Financial Services peer group — the box is the group’s distribution and the dots its largest members.

P/S Ratio (TTM)

PayPal (PYPL) trades at 1.43 on P/S ratio, roughly in the peer group’s normal range. The market is not making a strong cheap-or-rich statement about its revenue base.

PYPL

Financial Services industry group

1.43

Group distribution
Max
9.23
Q3
4.57
Median
2.72
PYPL
1.43
Q1
1.28
Min
-0.55
Largest peers
V
17.18
MA
15.67
MS
3.55
GS
3.52
BRK.A
3.18
BRK.B
3.18
PYPL
1.43
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Where PayPal (PYPL) stands on P/S ratio within its Financial Services peer group — the box is the group’s distribution and the dots its largest members.

P/B Ratio (MRQ)

PayPal (PYPL) trades at 2.55 on P/B ratio, roughly in line with the industry’s normal price-to-book range. Its balance sheet is not being priced at a clear discount or premium versus peers.

PYPL

Financial Services industry group

2.55

Group distribution
Max
7.79
Q3
3.63
PYPL
2.55
Median
1.57
Q1
0.81
Min
-0.39
Largest peers
MA
84.30
V
22.05
MS
2.65
PYPL
2.55
GS
2.36
BRK.A
1.72
BRK.B
0.00
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Where PayPal (PYPL) stands on P/B ratio within its Financial Services peer group — the box is the group’s distribution and the dots its largest members.

Valuation Metrics

PayPal (PYPL) metric values compared with Financial Services industry-group medians
MetricCurrent stock: PYPLIndustry group median
P/E Ratio (TTM)11.3115.37
P/S Ratio (TTM)1.432.72
P/B Ratio (MRQ)2.551.57
Free Cash Flow Yield (TTM)----