Baird and BofA Downgrade PayPal Holdings (PYPL)

PayPal Holdings, Inc. (NASDAQ:PYPL) is one of the 14 Most Promising Fintech Stocks to Invest In. On December 12, Baird downgraded PayPal Holdings, Inc. (NASDAQ:PYPL) from Outperform to Neutral and lowered the price target from $83 to $66. The firm pointed to “uneven” transaction volumes in the fourth quarter.

Baird also sees another investment cycle ahead in 2026. Additionally, the research firm pointed out that broader platform improvements have unclear timing. Baird believes that this means a “clearing event” for PayPal Holdings, Inc. (NASDAQ:PYPL) is less likely in the short term. The firm’s analyst noted that shares will likely stay range-bound until the company posts market share gains.

On December 11, BofA Securities also downgraded PayPal Holdings, Inc. (NASDAQ:PYPL) from Buy to Neutral and cut its price target from $93 to $68. BofA believes the company’s efforts to revitalize growth in the core branded business are moving slower than previously expected. This limits short-term stock upside. The research firm had previously expected that product innovation and an upgraded checkout experience would increase PayPal button usage across merchant websites. However, according to BofA’s analysis, Q4 will see a drop in branded checkout growth and 2026 is now set to be an investment year for PayPal Holdings, Inc. (NASDAQ:PYPL).

The research firm likes the company’s base of more than 400 million consumer and merchant accounts. It also sees the faster innovation under new management as a positive. Despite this, BofA believes the risk-reward balance now looks neutral.

PayPal Holdings, Inc. (NASDAQ:PYPL) is a global financial technology company that operates an online payment system and offers digital payments to consumers and merchants. The company provides online payment solutions in about 200 markets.

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Disclosure: None. This article is originally published at Insider Monkey.