Paypal Stock Analysis, Valuation (NASDAQ:PYPL)

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$81.08 $0.46 (0.57%) PYPL stock closing price May 23, 2018 (Closing)
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Paypal
Updated on : May 23, 2018
previous close
PYPL 81.1 (0%)
NASDAQ 7426 (0%)
Closing Price On: May 23, 2018
stock rating
RATING: ★★★★★★★★★★ (0/5)
Industry :
Internet Software
Sector :
Computer and Technology
5 Quarter Revenue
Revenue Growth
2018-Q1
$billion
%
YOY GROWTH
Compared to the industry
Operating Profit
Operating Margin:
16.2%
Sector Average:
5.4%
5 Quarter Net Profit
Net Margins
2018-Q1
%
LTM Margin
Compared to the industry
Debt/Equity Ratio
Debt:
1B
Debt/Equity Ratio:
 0.07
Compared to the industry
Cash Flow
Operating cash flow:
-$349M
Net Income:
$511M
PROS      CONS
Recent Growth
Operating Margins
Net Margins
Low Debt Burden
ROIC
ROE
Cash Flow
FCF Margin
PE Valuation
PS Valuation
Rating: ★★★★★★★★★★ (0/5)
Relative Valuation
PYPL PS :
7
Industry PS :
2.9
Sector:   Computer and Technology.   *PE adjusted for one time items.
Other Metrics
Return on Invested Capital:
17%
Return on Equity:
12.7%
Free Cash Flow Margin:
-14.3%
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Paypal Stock Analysis

3892 7 2

View the Paypal stock analysis video on Amigobulls. This is our analyst opinion covering the buy and sell arguments for PYPL stock.

Note: Amigobulls stock rating is our opinion based on the historical performance of the company's fundamentals. It is not indicative of the future performance of the stock.

Paypal Holdings Inc Stock Rating 2.4/5

Amigobulls PYPL stock analysis takes into account various financial ratios like relative valuation, Paypal revenue, growth and return on equity based on latest quarter 2018 Q1 financial statements. We also check Paypal dividend performance. We also use relative valuation metrics like PE ratio and price to sales ratio for Paypal valuation analysis. Paypal stock rating is our opinion about the business fundamentals of the company.

Should you buy PYPL stock?

  • The Year Over Year (YoY) revenue growth for Paypal was 23.9% in 2018 Q1.
  • The TTM operating margin was good at 16.2% for Paypal.
  • Net margins came in at average 13.9% for Paypal over the last twelve months.
  • With its debt/equity ratio of  0.07, Paypal has a lower debt burden when compared to the Computer and Technology average.
  • Paypal's return on invested capital of 17% is good.
  • Return On Equity (ROE) which is a measure of the company's profitability, looks great for Paypal at 12.7%.

Should you sell PYPL stock?

  • The PYPL stock currently trades at a PE of 52.3, which is expensive, compared to the industry average of 24.8.
  • The company is trading at a price to sales multiple of 7, which is overvalued in comparison to the Internet Software industry average multiple of 2.9.
  • The company has a negative free cash flow margin of -14.3%.

Comments on this video and Paypal stock

Investors can use Amigobulls Paypal stock analysis as a tool to arrive at accurate conclusions regarding financial health of the company and its valuation. Fundamentals of a company give detailed information which helps in making invesment decisions.

Paypal revenue growth and profit or net income are the main underlying forces which could detremine the direction of the share price. Along with fundamentals, investors can utilize technical analysis to get a better idea about the price trend of Paypal stock.