BMO Capital analyst James Fotheringham downgraded PayPal (PYPL) to Market Perform from Outperform with an unchanged price target of $156. The analyst cites a shift in investment strategy towards “credit-sensitive sub-sectors” in Financial Technology for the downgrade. As we transition to the recovery side of the current COVID-19 crisis, investors should switch into credit-sensitive financials like Capital One (COF), Citi (C) and Ally Financial (ALLY) that offer higher investment returns than PayPal’s current return of only 9%, Fotheringham tells investors in a research note. The analyst sees limited upside to PayPal’s valuation multiple.
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