PayPal Holdings: Hold Rating Amidst Mixed Progress and Ongoing Challenges

Bryan Bergin, an analyst from TD Cowen, maintained the Hold rating on PayPal Holdings (PYPL – Research Report). The associated price target was lowered to $83.00.

Bryan Bergin has given his Hold rating due to a combination of factors that reflect both progress and ongoing challenges at PayPal Holdings. The firm’s efforts in reaccelerating total payment volume (TM$) growth have shown some success, yet the performance in the Branded segment has not met market expectations. The core issues within the Branded business, alongside a competitive landscape, pose structural concerns that require attention. Investors are particularly focused on upcoming events where critical insights about the company’s strategic direction and composition of growth are anticipated.
Looking forward, while there is a forecasted steady growth in TM$ driven by various contributors such as Branded, Venmo, and Braintree, the deceleration in unbranded total payment volume growth and potential revenue headwinds raise caution. Additionally, while Venmo’s monetization efforts are making progress, they are still in the early stages, indicating that significant contributions are expected further down the line. These factors combined suggest that, despite improvements, the stock may not yet warrant a more optimistic rating.