William Blair analyst Andrew Jeffrey has reiterated their neutral stance on PYPL stock, giving a Hold rating today.
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Andrew Jeffrey’s rating is based on several factors that highlight both the challenges and potential of PayPal Holdings. The company experienced a slight decline in online branded volume growth, which is concerning given the inclusion of Buy Now, Pay Later (BNPL) services that showed significant volume expansion. Despite some growth in total branded experiences and Pay with Venmo transactions, the lack of acceleration in volume growth points to competitive pressures and difficulties in maintaining a strong value proposition.
Furthermore, while PayPal has shown some positive signs, such as increased EBIT margins and promising growth in BNPL and Venmo, the competitive landscape of digital finance presents ongoing challenges. The company’s ability to balance growth investments and credit costs while driving branded volume growth remains uncertain. Although there are opportunities for growth, such as the PayPal World wallet offering, the complexities of wallet unification and the uncertain role of cryptocurrency as a consumer tender add to the cautious outlook. As a result, Andrew Jeffrey has given PayPal a Hold rating, reflecting both the potential and the hurdles the company faces.