📊 PYPL Key Takeaways
Is PayPal Holdings, Inc. (PYPL) a Good Investment?
PayPal demonstrates financial stability with solid profitability margins (17.8% operating margin) and strong free cash flow generation ($903M), supported by conservative leverage (0.54x debt-to-equity) and excellent interest coverage (17.3x). However, the disconnect between modest revenue growth (4.3%) and aggressive EPS growth (35.6%) raises earnings quality concerns, while critically low returns on equity (5.6%) and assets (1.4%) signal inefficient capital deployment.
Why Buy PayPal Holdings, Inc. Stock? PYPL Key Strengths
- Strong profitability metrics with 17.8% operating margin and 13.3% net margin demonstrating operational efficiency
- Robust free cash flow generation of $903M with healthy 10.8% FCF margin and disciplined capex at $231M
- Excellent debt service capacity with 17.3x interest coverage ratio and conservative 0.54x debt-to-equity ratio
- Accelerating earnings per share growth of 35.6% YoY indicating cost control and operational leverage
PYPL Stock Risks: PayPal Holdings, Inc. Investment Risks
- Critically poor capital returns: 5.6% ROE and 1.4% ROA well below acceptable thresholds for financial services
- Unsustainable earnings growth: EPS growing at 35.6% while revenue grows only 4.3% raises sustainability red flags
- Operating cash flow equal to net income ($1.1B) with no significant outperformance indicates earnings quality concerns
- Absolute leverage remains high at $60.5B liabilities despite moderate ratios, reducing financial flexibility
Key Metrics to Watch
- Revenue growth acceleration versus EPS growth normalization to assess earnings sustainability
- Return on equity and return on assets trajectory toward improving capital efficiency benchmarks
- Operating cash flow margin relative to net income margin for earnings quality validation
- Debt reduction pace and management's capital allocation priorities going forward
PayPal Holdings, Inc. (PYPL) Financial Metrics & Key Ratios
💡 AI Analyst Insight
PayPal Holdings, Inc. presents a mixed fundamental picture. Review the detailed metrics above to form your own investment thesis.
PYPL Profit Margin, ROE & Profitability Analysis
PYPL vs Services Sector: How PayPal Holdings, Inc. Compares
How PayPal Holdings, Inc. compares to Services sector averages
Sector benchmarks are approximate industry averages. Actual sector performance may vary.
Is PayPal Holdings, Inc. Stock Overvalued? PYPL Valuation Analysis 2026
Based on fundamental analysis, PayPal Holdings, Inc. has mixed fundamental signals relative to the Services sector in 2026.
Note: This is a fundamental analysis based on SEC filings. For P/E ratio, price targets, and market-based valuation, consult financial data providers. This is not investment advice.
PayPal Holdings, Inc. Balance Sheet: PYPL Debt, Cash & Liquidity
PYPL Revenue & Earnings Growth: 5-Year Financial Trend
5-Year Trend Summary: PayPal Holdings, Inc.'s revenue has grown significantly by 31% over the 5-year period, indicating strong business expansion. The most recent EPS of $3.84 reflects profitable operations.
PYPL Revenue Growth, EPS Growth & YoY Performance
PYPL Quarterly Earnings & Performance
| Quarter | Revenue | Net Income | EPS |
|---|---|---|---|
| Q1 2026 | $7.8B | $1.1B | $1.21 |
| Q3 2025 | $7.8B | $888.0M | $0.99 |
| Q2 2025 | $7.9B | $888.0M | $1.08 |
| Q1 2025 | $7.7B | $888.0M | $0.83 |
| Q3 2024 | $7.4B | $795.0M | $0.93 |
| Q2 2024 | $7.3B | $795.0M | $0.92 |
| Q1 2024 | $7.0B | $795.0M | $0.70 |
| Q3 2023 | $6.8B | -$341.0M | $0.93 |
Data sourced from SEC EDGAR 10-Q quarterly filings. Figures may represent quarterly or cumulative values.
PayPal Holdings, Inc. Dividends, Buybacks & Capital Allocation
PYPL SEC Filings: Latest 10-K & 10-Q Analysis
Access official SEC EDGAR filings for PayPal Holdings, Inc. (CIK: 0001633917)
📋 Recent SEC Filings
❓ Frequently Asked Questions about PYPL
What is the AI rating for PYPL?
PayPal Holdings, Inc. (PYPL) has an AI rating of HOLD with 72% confidence, based on fundamental analysis of SEC EDGAR filings.
What are PYPL's key strengths?
Claude: Strong profitability metrics with 17.8% operating margin and 13.3% net margin demonstrating operational efficiency. Robust free cash flow generation of $903M with healthy 10.8% FCF margin and disciplined capex at $231M.
What are the risks of investing in PYPL?
Claude: Critically poor capital returns: 5.6% ROE and 1.4% ROA well below acceptable thresholds for financial services. Unsustainable earnings growth: EPS growing at 35.6% while revenue grows only 4.3% raises sustainability red flags.
What is PYPL's revenue and growth?
PayPal Holdings, Inc. reported revenue of $8.4B.
Does PYPL pay dividends?
PayPal Holdings, Inc. pays dividends, with $130.0M distributed to shareholders in the trailing twelve months.
Where can I find PYPL SEC filings?
Official SEC filings for PayPal Holdings, Inc. (CIK: 0001633917) including 10-K, 10-Q, and 8-K reports are available on SEC EDGAR.
What is PYPL's EPS?
PayPal Holdings, Inc. has a diluted EPS of $1.21.
How is the AI analysis conducted?
Two independent AI systems — Claude (Anthropic) and ChatGPT (OpenAI) — analyze SEC EDGAR filings including 10-K annual reports and 10-Q quarterly reports. Each AI evaluates financial health, profitability ratios, balance sheet strength, and growth metrics. The combined rating reflects both perspectives for balanced insights.
Is PYPL a good stock to buy right now?
Based on our AI fundamental analysis in May 2026, PayPal Holdings, Inc. has a HOLD rating with 72% confidence. Review the strengths and risks sections above before making a decision. This is not investment advice.
Is PYPL stock overvalued or undervalued?
Valuation metrics for PYPL: ROE of 5.6% (sector avg: 16%), net margin of 13.3% (sector avg: 10%). Compare these metrics with sector averages to assess valuation.
Should I buy PYPL stock in 2026?
Our dual AI analysis gives PayPal Holdings, Inc. a combined HOLD rating for 2026. Revenue is data pending, with profitability above sector average. Always conduct your own research.
What is PYPL's free cash flow?
PayPal Holdings, Inc.'s operating cash flow is $1.1B, with capital expenditures of $231.0M. FCF margin is 10.8%.
How does PYPL compare to other Services stocks?
Vs Services sector averages: Net margin 13.3% (avg: 10%), ROE 5.6% (avg: 16%), current ratio 1.26 (avg: 1.5).