The Case For Buying Paypal Holdings Inc Shares Into The Quarter: Deutsche Bank
In a research report released Monday, Deutsche Bank analyst Bryan Keane reiterated a Buy rating on shares of Paypal Holdings Inc (NASDAQ:PYPL), and raised the price target from $42 to $44, as the company is scheduled to report its third-quarter earnings after the bell on Wednesday, October 28th.
Keane wrote, “On October 28th we see PYPL reporting revenues of $2.25bn (+14.2% y/y, +18.4%cc) and EPS of $0.29. PYPL will report its first earnings as an independent company and we believe a solid 3Q print could help get investors comfortable with the model. The ramp of One Touch rollout, monetization of Venmo, large merchant win (omni-channel win with Macy’s) and expansion into payment processing for online gaming bode well. Despite take rate moderation from mix shift, we expect the operating margins to expand due to operating leverage. Trading at 11x CY17 EV/EBITDA, a discount to merchant acquirers despite significantly higher growth rates and unique digital payment asset, we continue to like the risk/reward.”
According to TipRanks.com, which measures analysts’ and bloggers’ success rate based on how their calls perform, analyst Bryan Keane has a total average return of 14.8% and a 79.2% success rate. Keane has a 0.7% average return when recommending PYPL, and is ranked #143 out of 3788 analysts.
Out of the 32 analysts polled by TipRanks, 21 rate Paypal Holdings Inc stock a Buy, 8 rate the stock a Hold and 3 recommend Sell. With a return potential of 19.2%, the stock’s consensus target price stands at $41.51.