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Paypal (PYPL) Dips More Than Broader Markets: What You Should Know

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Paypal (PYPL - Free Report) closed the most recent trading day at $98.55, moving -1.67% from the previous trading session. This change lagged the S&P 500's daily loss of 0.43%. Elsewhere, the Dow lost 0.34%, while the tech-heavy Nasdaq lost 0.62%.

Coming into today, shares of the technology platform and digital payments company had lost 18.48% in the past month. In that same time, the Computer and Technology sector lost 9.41%, while the S&P 500 lost 6.57%.

Paypal will be looking to display strength as it nears its next earnings release. The company is expected to report EPS of $0.90, down 26.23% from the prior-year quarter. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $6.41 billion, up 6.33% from the year-ago period.

PYPL's full-year Zacks Consensus Estimates are calling for earnings of $4.69 per share and revenue of $29.37 billion. These results would represent year-over-year changes of +1.96% and +15.75%, respectively.

Investors might also notice recent changes to analyst estimates for Paypal. These revisions typically reflect the latest short-term business trends, which can change frequently. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.

Research indicates that these estimate revisions are directly correlated with near-term share price momentum. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.

The Zacks Rank system ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. The Zacks Consensus EPS estimate remained stagnant within the past month. Paypal is holding a Zacks Rank of #5 (Strong Sell) right now.

Looking at its valuation, Paypal is holding a Forward P/E ratio of 21.37. This represents a discount compared to its industry's average Forward P/E of 47.08.

Investors should also note that PYPL has a PEG ratio of 1.11 right now. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. The Internet - Software was holding an average PEG ratio of 2.96 at yesterday's closing price.

The Internet - Software industry is part of the Computer and Technology sector. This group has a Zacks Industry Rank of 185, putting it in the bottom 28% 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.

To follow PYPL in the coming trading sessions, be sure to utilize Zacks.com.


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