Fintech company PayPal Holdings (NASDAQ:PYPL) released its third-quarter earnings last week, which
beat expectations on both the top and bottom lines. Revenue of $6.85 billion for the period ending Sept.
30 came in higher than analyst estimates of $6.82 billion and adjusted earnings per share of $1.08 was
also better than the $0.96 that Wall Street was looking for.
However, the stock still fell on the results as the company’s guidance for the fourth quarter was a bit
underwhelming at $7.38 billion versus expectations of $7.74 billion.
Although that’s a bit light, there is promise that PayPal’s business could get a boost. Last month, online
retailer Amazon (NASDAQ:AMZN) said that it would be accepting Venmo payments on its platform.
Meanwhile, PayPal is also working with Apple (NASDAQ:AAPL) to give Venmo and PayPal merchants
more options, including being able to accept Apple Pay .
Through these initiatives, there should be more traffic across PayPal’s platforms which, in the long run,
can help strengthen PayPal’s numbers.
The risk for investors today is that if the economy sinks into a recession next year, that will likely mean
there will be a decline in activity overall, which could hurt the stock’s appeal. But if you’re willing to hold
on to the stock for years, PayPal could make for a great investment to hang on to.
Year to date, shares of PayPal are down 60%, which is far worse than the S&P 500 has performed, falling
by around 20%. It is currently trading around 2018 levels and while it could still fall lower in the bear
market, PayPal’s stock possesses plenty of upside from where it is right now.