government is still figuring out its stance, policy-wise, regarding stablecoins. Even if this new token isn’t used to make day-to-day purchases in the near future, it’s reasonable to expect that customers will use PayPal USD to purchase and sell other cryptocurrency tokens on PayPal’s platform. It will certainly be interesting to see what PayPal, under Chriss’s leadership, does with PayPal USD. This is a cryptocurrency token which, because it’s a stablecoin, will be pegged to the U.S.

While you’re at it, consider that PayPal looks like a reasonably valued tech company, with its trailing 12-month price-to-earnings (P/E) ratio of 17.76x.Ĭhriss will inherit an exciting development at PayPal: the company’s stablecoin, known as PayPal USD. My point is, give the new CEO a chance before pronouncing a final judgment on PayPal’s future prospects. Finding Stability With PayPal’s Stablecoin However, I suspect that fear of C-suite change is also driving the market’s trepidation about PayPal. PYPL stock has struggled in 2023 so far because of a number of factors, including concerns about the threat from Apple’s (NASDAQ: AAPL) Apple Pay service. And, as Peerage Capital founder Miles Nadal explained, “Coming from the outside, whatever your credentials or accomplishments, you are going to face fear-based skepticism.”ĭon’t get the wrong idea. Until now, Chriss has been an outsider to PayPal (i.e., he’s not an executive at the company). The company is in a critical transitional period, as Alex Chriss is set to replace current PayPal CEO Dan Schulman on Sept. Right now, I invite you to lean into the uncertainty surrounding PayPal rather than avoid it. However, it’s psychologically difficult for some investors to tolerate not knowing what the future holds. Personally, I thrive when there’s uncertainty because that’s when asset prices are undervalued. If there’s one thing that the financial market can’t stand, it’s uncertainty. This is a top-tier fintech business that too many financial traders and commentators are underestimating, in my opinion. Remember, 70% of Millennials reportedly use PayPal for their money transactions. So, if you’re willing to take on some risk, you might have a chance to invest in PayPal at a favorable share price. Why hasn’t PayPal (NASDAQ: PYPL) stock participated in the massive tech-stock rally of 2023 so far? A main reason is the market’s feelings of reluctance and uncertainty about PayPal during this transitional period for the company. When you combine this positive Earnings ESP with the stock's Zacks Rank #3 (Hold), it shows that another beat is possibly around the corner.Here’s a billion-dollar question for you. Paypal has an Earnings ESP of +3.60% at the moment, suggesting that analysts have grown bullish on its near-term earnings potential.

The idea here is that analysts revising their estimates right before an earnings release have the latest information, which could potentially be more accurate than what they and others contributing to the consensus had predicted earlier. The Zacks Earnings ESP compares the Most Accurate Estimate to the Zacks Consensus Estimate for the quarter the Most Accurate Estimate is a version of the Zacks Consensus whose definition is related to change. In other words, if you have 10 stocks with this combination, the number of stocks that beat the consensus estimate could be as high as seven. Our research shows that stocks with the combination of a positive Earnings ESP and a Zacks Rank #3 (Hold) or better produce a positive surprise nearly 70% of the time. In fact, the Zacks Earnings ESP (Expected Surprise Prediction) for the stock is positive, which is a great indicator of an earnings beat, particularly when combined with its solid Zacks Rank. Thanks in part to this history, there has been a favorable change in earnings estimates for Paypal lately.

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