PayPal: Too Late To Sell (Downgrade)

RI Research1.58K FollowersFollow5ShareSavePlay(9min)Comment(1)SummaryPayPal is downgraded to Hold as macro headwinds, cautious management guidance, and intensifying competition undermine near-term upside.Recent Wall Street downgrades cite branded checkout growth concerns and uncertain ROI in new products, reflecting deteriorating sentiment toward PYPL.Despite a strong Q3 double beat, management expects slowing transaction margin growth and normalization of credit business, signaling challenging FY2026 prospects.PYPL's valuation is deeply discounted, with a forward Price/FCF of 8.4 versus the sector median of 13.8, but several risks temper rebound potential. franckreporter/iStock Unreleased via Getty Images My September decision to upgrade PayPal Holdings, Inc. (PYPL) back to Strong Buy turned out to be too optimistic, as the company's market cap decreased by almost 10% since then while the S&P 500This article was written byRI Research1.58K FollowersFollowWith a decade at a Big 4 audit firm specializing in the banking, mining, and energy sectors, I bring a strong foundation in finance and strategy. Currently, I serve as the Head of Finance for a leading owner and operator of retail real estate, where I oversee complex financial operations and strategy. I’ve been an active investor in the U.S. stock market for 13 years, starting with my very first paycheck. Over time, my portfolio has evolved to reflect a balanced approach, with a growing focus on value stocks while maintaining solid exposure to growth opportunities. My investment philosophy is rooted in thorough research and a long-term perspective, which has helped me navigate various market cycles successfully. I aim to bring value to Seeking Alpha by uncovering promising under-the-radar stocks that may not yet be on the broader market’s radar. My background in auditing and finance, combined with years of hands-on investing experience, allows me to provide unique insights and actionable ideas for fellow investors.Analyst’s Disclosure:I/we have a beneficial long position in the shares of PYPL either through stock ownership, options, or other derivatives. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article. Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.Recommended For You