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Investing.com - Truist Securities has maintained its Sell rating and $68.00 price target on PayPal (NASDAQ:PYPL) following the company’s second-quarter earnings report. The fintech giant, currently valued at $67.83 billion, is trading at 14.97x earnings, though InvestingPro analysis suggests the stock may be undervalued at current levels.
The financial services firm expressed concerns about the quality of PayPal’s growth drivers despite what initially appeared to be solid quarterly results.
According to Truist’s analysis, PayPal’s year-over-year transaction margin dollar growth was only approximately 3% when excluding a one-time benefit and OVAS (Other Value Added Services) revenues.
The firm noted that a 35% year-over-year growth in credit-related revenues helped boost PayPal’s second-quarter performance.
Truist remains concerned about slower top-line growth for PayPal relative to market expectations, particularly as the company faces tougher comparisons in upcoming quarters.
In other recent news, PayPal reported its second-quarter earnings for 2025, surpassing Wall Street expectations in both revenue and non-GAAP earnings per share. Despite these positive results, KeyBanc Capital Markets maintained its Sector Weight rating on the company, citing concerns over tariff impacts and a slowdown in Branded online total payment volume growth. Additionally, PayPal raised its full-year guidance, projecting continued growth in transaction margin dollars and non-GAAP EPS. However, Citizens JMP lowered its price target for PayPal from $110 to $100, while maintaining a Market Outperform rating. This adjustment reflects the competitive pressures PayPal faces from digital wallets and the company’s ongoing investments to increase consumer adoption. The company’s stock experienced a decline following the earnings announcement, but analysts remain focused on its long-term growth potential. These developments highlight the challenges and opportunities PayPal faces in the current market environment.
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