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PYPL or MA: Which Is the Better Value Stock Right Now?

By Zacks Equity Research | August 06, 2025, 11:40 AM

Investors interested in Financial Transaction Services stocks are likely familiar with Paypal (PYPL) and MasterCard (MA). But which of these two stocks is more attractive to value investors? We'll need to take a closer look to find out.

We have found that the best way to discover great value opportunities is to pair a strong Zacks Rank with a great grade in the Value category of our Style Scores system. The Zacks Rank is a proven strategy that targets companies with positive earnings estimate revision trends, while our Style Scores work to grade companies based on specific traits.

Paypal has a Zacks Rank of #2 (Buy), while MasterCard has a Zacks Rank of #3 (Hold) right now. This means that PYPL's earnings estimate revision activity has been more impressive, so investors should feel comfortable with its improving analyst outlook. However, value investors will care about much more than just this.

Value investors are also interested in a number of tried-and-true valuation metrics that help show when a company is undervalued at its current share price levels.

The Style Score Value grade factors in a variety of key fundamental metrics, including the popular P/E ratio, P/S ratio, earnings yield, cash flow per share, and a number of other key stats that are commonly used by value investors.

PYPL currently has a forward P/E ratio of 13.02, while MA has a forward P/E of 34.75. We also note that PYPL has a PEG ratio of 1.05. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. MA currently has a PEG ratio of 2.32.

Another notable valuation metric for PYPL is its P/B ratio of 3.21. The P/B ratio pits a stock's market value against its book value, which is defined as total assets minus total liabilities. For comparison, MA has a P/B of 65.54.

These are just a few of the metrics contributing to PYPL's Value grade of A and MA's Value grade of D.

PYPL is currently sporting an improving earnings outlook, which makes it stick out in our Zacks Rank model. And, based on the above valuation metrics, we feel that PYPL is likely the superior value option right now.

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PayPal Holdings, Inc. (PYPL): Free Stock Analysis Report
 
Mastercard Incorporated (MA): Free Stock Analysis Report

This article originally published on Zacks Investment Research (zacks.com).

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