Paypal Holdings Inc (NASDAQ:PYPL) hosted this week its first analyst day since the spin-off from eBay and roughly one year since the company’s initial analyst meeting. The analyst Day highlighted the company’s ongoing transition from a payment button on an online checkout page to a full-service payments platform, supporting merchants virtually across the entire commerce spectrum.
However, Axiom analyst Victor Anthony remains sidelined amid an increasingly competitive landscape. In a research report issued today, Anthony reiterated a Hold rating on the stock, with a price target of $36.
Anthony wrote, “The presentations were positive and illuminated the growth opportunities ahead for the company, but did little to adjust our estimates higher and change our investment opinion on the stock. The main takeaway was how PayPal plans to drive engagement per customer to 2-3x per week from 2-3x per month today through offering more payment options to consumers (expand ways to get money in and get money out) while increasing the merchant value proposition through enhanced services (risk, contextual commerce, rewards, working capital) and technology.”
“We agree that if that level of usage occurred the stock should be re-rated higher. Until then we will continue to watch how PayPal executes against what they see as a $100 trillion TAM and what we see as an increasingly competitive landscape (a key bear case which management did little to address) and a rapid shift to mobile and currency digitization,” the analyst concluded.
According to TipRanks.com, which measures analysts’ and bloggers’ success rate based on how their calls perform, analyst Victor Anthony has a yearly average return of 10.2% and a 57% success rate. Anthony has a average return when recommending PYPL, and is ranked #117 out of 3929 analysts.Out of the 37 analysts polled by TipRanks, 21 rate Paypal Holdings Inc stock a Buy, 13 rate the stock a Hold and 3 recommend Sell. With a return potential of 15.1%, the stock’s consensus target price stands at $43.65.