PayPal Top Earnings Forecasts, Bets on CryptoDigital payments giant PayPal jumped over 4% in extended-hours trade Wednesday after the company reported better-than-expected quarterly results. Here’s how to trade the stock.
PayPal Holdings, Inc. (PYPL) shares rocketed over 4% higher in Wednesday’s extended-hours trading session after the company delivered a stellar quarterly earnings report.
The San Jose digital payments giant reported an adjusted first quarter (Q1) profit of $1.22 per share, blowing pasts Wall Street’s expectation of $1.01 a share. Moreover, the bottom line grew 85% from a year earlier. Revenues for the period came in at $6.03 billion, up from year-ago sales of $4.62 billion. Volume and user metrics also impressed, with the company processing $285 billion in the quarter and adding 14.5 million net new active accounts.
Trading Derivatives carries a high level of risk to your capital and you should only trade with money you can afford to lose. Trading Derivatives may not be suitable for all investors, so please ensure that you fully understand the risks involved, and seek independent advice if necessary. A Product Disclosure Statement (PDS) can be obtained either from this website or on request from our offices and should be considered before entering into a transaction with us. Raw Spread accounts offer spreads from 0.0 pips with a commission charge of USD $3.50 per 100k traded. Standard account offer spreads from 1 pips with no additional commission charges. Spreads on CFD indices start at 0.4 points. The information on this site is not directed at residents in any country or jurisdiction where such distribution or use would be contrary to local law or regulation.
Looking ahead, management forecasts Q2 EPS of $1.12 on revenues of $6.25 billion. Analysts had expected earnings of $1.10 on sales of $6.16 billion. The company sees cryptocurrency continuing to drive growth in upcoming quarters. “We’ve got a tremendous amount of really great results going on tactically with our crypto efforts,” CEO Dan Schulman told investors, per CNBC. PayPal initially introduced leading cryptocurrencies to its platform last October and has progressively added more integration with digital assets over the past six months.
Through Wednesday’s close, PayPal stock has a market capitalization nearing $300 billion and trades nearly 100% higher over the last 12 months. YTD, the shares have added 5.64%, which trails the S&P 500’s gain of 11% over the same period.
Wall Street View
Late last month, Rosenblatt Securities analyst Sean Horgan raised his price target on the stock to $350 from $320 and maintained his ‘Buy’ recommendation. Horgan sees the payments giant continuing to benefit from higher levels of consumer spending, fueled by record levels of government stimulus.
Elsewhere, the stock racks up mostly favorable brokerage coverage. It receives 36 ‘Buy’ ratings, 5 ‘Overweight’ ratings, and 6 ‘Hold’ ratings. Just one analyst recommends selling the shares. Wall Street has a 12-month price median price target on the stock at $314.55. This represents 27% of upside from yesterday’s $247.40 close.
Technical Outlook and Trading Tactics
PayPal shares have recently retraced to a multi-month uptrend line extending back to the March 2020 pandemic-induced low. Although the price broke below this closely-watched indicator in Wednesday’s session, pre-market trading indicates a move back above it after the company’s solid earnings report.
Providing the stock closes above the trendline, active traders should anticipate a retest of the YTD high at $309.14. Protect capital with a stop-loss order placed under today’s low.
For a look at today’s earnings schedule, check out our earnings calendar.