Paypal (PYPL) closed the most recent trading day at $58.38, moving -1.22% from the previous trading session. This change lagged the S&P 500's 0.74% loss on the day. At the same time, the Dow lost 0.63%, and the tech-heavy Nasdaq lost 0.76%.
Shares of the technology platform and digital payments company have depreciated by 6.04% over the course of the past month, underperforming the Business Services sector's gain of 2.83%, and the S&P 500's gain of 0.79%.
The investment community will be closely monitoring the performance of Paypal in its forthcoming earnings report. The company is forecasted to report an EPS of $1.29, showcasing a 8.4% upward movement from the corresponding quarter of the prior year. In the meantime, our current consensus estimate forecasts the revenue to be $8.81 billion, indicating a 5.31% growth compared to the corresponding quarter of the prior year.
For the entire fiscal year, the Zacks Consensus Estimates are projecting earnings of $5.34 per share and a revenue of $33.29 billion, representing changes of +14.84% and +4.69%, respectively, from the prior year.
Investors should also pay attention to any latest changes in analyst estimates for Paypal. These revisions typically reflect the latest short-term business trends, which can change frequently. With this in mind, we can consider positive estimate revisions a sign of optimism about the business outlook.
Research indicates that these estimate revisions are directly correlated with near-term share price momentum. To take advantage of this, we've established the Zacks Rank, an exclusive model that considers these estimated changes and delivers an operational rating system.
The Zacks Rank system, spanning from #1 (Strong Buy) to #5 (Strong Sell), boasts an impressive track record of outperformance, audited externally, with #1 ranked stocks yielding an average annual return of +25% since 1988. The Zacks Consensus EPS estimate has moved 0.06% lower within the past month. Right now, Paypal possesses a Zacks Rank of #3 (Hold).
In the context of valuation, Paypal is at present trading with a Forward P/E ratio of 11.07. This expresses a discount compared to the average Forward P/E of 14.33 of its industry.
One should further note that PYPL currently holds a PEG ratio of 0.81. Comparable to the widely accepted P/E ratio, the PEG ratio also accounts for the company's projected earnings growth. By the end of yesterday's trading, the Financial Transaction Services industry had an average PEG ratio of 1.02.
The Financial Transaction Services industry is part of the Business Services sector. This group has a Zacks Industry Rank of 177, putting it in the bottom 29% of all 250+ industries.
The Zacks Industry Rank gauges the strength of our individual industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
Be sure to use Zacks.com to monitor all these stock-influencing metrics, and more, throughout the forthcoming trading sessions.
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PayPal Holdings, Inc. (PYPL): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).
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