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May 19, 2022
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TLDR: PYPL is a buy, will outperform the NASDAQ, and can double your investment long term with only shares.
PayPal was not immune to the hit that growth stocks have taken in 2022. The stock is down 75% from its ATH. But here's why PayPal is a buy: PayPal is a global online payments titan that controls the online payments sector across the world. PayPal outpaces all other online payment services in growth and volume, including Apple Pay. It is a trusted brand, well known, with great financials and margins. PayPals new agreement with Amazon will even further their payments volume and capture even more of the online payments market. PayPal is accepted as a form of payment on 70% of all e-commerce shops, this is significantly higher than other online payment options.
Here are the numbers.
Current valuation: PYPL is trading at $79.00 per share with a market cap of 89 billion.
52 week range: High of 310.16 Low of 71.83
Price / earnings: PYPL is historically cheaper today than it has been in 5 years. The stocks current valuation is actually cheaper today than in 2018 with regard to their earnings. PYPL is currently at P/E of 26.12, while in the last 5 years it averages closer to 50.00. $SQ currently has a P/E of over 300.
Insiders: 5/6/22 Chief product officer bought 600k worth of shares for 81.04 per share. 5/4/22 director bought 100k worth of shares for 88.13 per share. 4/1/22 CEO bought derivatives equal to 126,370 shares, over 10 million dollar bet.
My positions: 1/20/23 expiration 500 195/200 bull call spread average price 0.11 per spread, worth 250k if PayPal closes above $200 at expiration.