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“A Great Day for Student Athletes”: PayPal Stock (NASDAQ:PYPL) Slips With New Student Athlete Connection

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PayPal makes a new connection with student athletes and colleges alike, and also helps bolster the fintech picture in India.

“A Great Day for Student Athletes”: PayPal Stock (NASDAQ:PYPL) Slips With New Student Athlete Connection

Remember that episode of South Park where Cartman tries to get some slaves—er, “student ath-o-letes”—for his new basketball association? That proposition is about to get a lot more expensive. The idea of student athletes being paid in anything more than free college classes is a comparatively new one, but financial technology stock PayPal (PYPL) is prepared to make hay while the sun shines. This new connection will provide a way for those student athletes to get paid, but investors were less than pleased by the innovation. Shares slipped fractionally in Thursday afternoon’s trading.

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A recent court settlement—House v. NCAA—allows schools to directly pay student athletes. The settlement calls for as much as $20.5 million to go to current athletes over the next year, and an additional $2.8 billion to go out to former college athletes as well. PayPal stepped in, offering a way to make those payments easier to actually get out the door, and thus set up a deal with both the Big Ten and the Big 12 conferences in aid of that. Big 12 commissioner Brett Yormark declared this move part of “…a great day for student athletes….”

Not only will those athletes get paid through PayPal, but the athletes will also have the ability to pay the college through PayPal for things like tuition. PayPal will become a “preferred payment partner” at some schools, which should speed up the process a little bit over the former method of mailing a paper check.

Boosting Fintech Everywhere

Meanwhile, PayPal’s efforts to roll out new financial technology (fintech) operations in India are going well, as the operation it backs therein, Pine Labs Ltd., recently filed for an initial public offering. Pine Labs looks to raise up to 26 billion rupees, about $303 million U.S., through the sale of new shares. Reports also noted that a pre-IPO sale may also take place, looking to land about a fifth of its total.

This would represent the largest IPO listing by an Indian firm since 2021, when One97 Communications Ltd launched a $2.5 billion fundraising round. With India accounting for nearly half—46% at last report—of the world’s total digital transactions, it is fertile ground for fintech. It also represents a clear reason for PayPal to take a hand in the market, as represented by Pine Labs.

Is PayPal a Buy, Hold or Sell?

Turning to Wall Street, analysts have a Moderate Buy consensus rating on PYPL stock based on 13 Buys, 16 Holds and three Sell recommendations assigned in the past three months, as indicated by the graphic below. After a 25.18% rally in its share price over the past year, the average PYPL price target of $80.07 per share implies 10.47% upside potential.

See more PYPL analyst ratings

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